Having recommended DWA long earlier this month, I was thrilled to see this headline today. Now we're beginning to see what Softbank will do with a portion of their profits from the Alibaba ($BABA) investment after their IPO last week.
According to Hollywood Reporter, Japanese conglomerate SoftBank is in talks to acquire DreamWorks Animation in a deal that would value the company at $3.4 billion, according to a source with knowledge of the situation.
SoftBank has been in the news lately because of its $20 million investment in Chinese Internet giant Alibaba (BABA), a stake now worth a minimum of $60 billion. The sprawling company is considered undervalued and on Sept. 25, Jefferies Group LLC rated SoftBank as "a compelling buy opportunity."
DWA founder and CEO Jeffrey Katzenberg would sign a five-year contract to remain with the company, according to the source, who says the DWA board held an emergency meeting Thursday to consider the offer. SoftBank is said to have offered $32 a share; a more than 40% premium to DWA closing price of $22 per share on Friday.
A DWA spokesperson said, "We don't comment on rumors and speculation."
Former Google executive Nikesh Arora, who joined SoftBank in July, is said to have been a liaison between DWA and his new firm. Arora is the head of a newly formed unit, SoftBank Internet and Media Inc.
I will take profits in 1/2 size *if* the stock pops and hold the balance to see if the deal progresses further.