Wednesday, August 03, 2005

Hit #58

SSA Global (SSAG) announced that it is buying Epiphany (EPNY) for $329 million in cash, valuing the shares at $4.2/share. This is a discount of 55% to my average price of $7.5/share. I had a very small number of shares that I failed to average down further during later pullbacks.

This is one transaction where I actually wish that I received stock of the buying company instead of cash. SSA Global went public just a few weeks ago. It has been extremely smart in acquiring assets cheaply, like it did with Baan in the past. In fact, I expected the public offering to be aborted by a takeover from SAP or Oracle. Oracle instead, decided to waste its money on I-Flex! Both SAP and Oracle will repent not having bought SSA and one of them will eventually buy SSA at a much higher price.

SSA has not yet received analyst attention on the Street and hence the stock is still cheap. I bought a few recently and will continue adding as long as the stock remains in the $12-$15 range.

Previous hit - E-Loan (#57)


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