Business Objects Goes On The Block

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Le Figaro has run a story saying that business intelligence software provider Business Objects (BOBJ) has put itself up for sale, retaining Goldman Sachs. The company would probably draw interest from Oracle (ORCL) or SAP (SAP). On Friday, the company’s shares were downgraded to "neutral" from "buy" by First Albany. The analyst may look a little silly when the shares open on Monday.

But, it may be a difficult time to sell the company. At times during the last two weeks, BOBJ share have been up as much as 40% on the year. Finding a buyer who would pay a premium over that may be a nice trick. The company currently has a market cap of $4 billion.

In the most recent quarter BOBJ revenue grew year-over-year to $363.2 million from $294.5 million. The company earned $21.6 million, or 22 cents per ordinary share and American Depositary Share, compared with $7.9 million in the same quarter a year ago. The company did say that the next quarter would be weak and lowered guidance.

With the stock near a five-year high and signaling some near-term weakness, BOBJ will be hard to shop.

Douglas A. McIntyre