UTC's Offer to Diebold a No-Go

The board of Diebold Inc. has rejected an unsolicited offer by Untied Technologies to takeover the company for $2.63 billion, and has said that the timing is wrong to pursue discussions on the matter.

The board also has recommended that shareholders take no action at the present time. At least three times in the last month, Diebold’s board has met with UTC to discuss interest in a potential merger. But given that Diebold has not filed financial statements since the company’s 10-Q for the quarter ended March 31, 2007, and that the company is working to update its filings with the Securities and Exchange Commission, the board has said it is not the right time for such an act with UTC.

“The board strongly believes that UTC’s proposal significantly undervalues the company and fails to reflect Diebold’s strengths and significant upside potential,” John Lauer, Diebold’s non-executive chairman, said in a statement. “UTC’s proposal is an opportunistic attempt to buy Diebold at a time when shareholders do not have sufficient data to evaluate the offer and as such, the board believes that it would be irresponsible to engage in discussions with UTC at this time.”

Lauer added that the board intends to wait until its filings are completed so that shareholders can make a well-informed decision regarding a potential acquisition.