Apple, Qualcomm, others eye InterDigital - sources
Apple Inc, Nokia and Qualcomm Inc are among several technology companies pondering bids for InterDigital Inc, sources familiar with the situation said.
The auction of the wireless telecommunications specialist -- expected to be heavily contested as giant tech companies fight to shore up patent portfolios -- will be postponed from next week until after Labor Day, the sources said.
Shares in InterDigital, which has a market value of about $3 billion, leaped as much as 12.2 percent on the news. But it quickly backtracked and was up $4.38 or 6.8 percent at $68.41 in afternoon trade.
Key potential bidder Google Inc has not formally withdrawn from the auction but it is unclear whether the Internet leader will bid for the company, the sources told Reuters.
InterDigital is up for sale and is forging ahead with its auction, despite Google agreeing to buy Motorola Mobility Holdings Inc for $12.5 billion. That triggered a 23 percent drop in InterDigital's shares on Monday.
First-round bids have been postponed because bidders asked for more time to complete due diligence on the company's patents, the sources said.
To make up for that delay, the King of Prussia, Pennsylvania-based company expects to accelerate the second round, the sources said.
Google's presence in the auction would be crucial to how much InterDigital could fetch, an analyst said.
The problem InterDigital has is that Elvis has left the building. He's got his date, Deutsche Bank analyst Brian Modoff said.
Modoff also questioned whether any other technology companies need InterDigital enough to pay the high price at which its shares are currently trading.
He noted that Qualcomm already has a good portfolio of patents, and so may not want to pay up for the business.
The problem is finding somebody else to whom it's necessary. Modoff said. It could get acquired, but not at where the stock is at (now).
InterDigital's stock had soared last month on reports that Google was in talks to buy the company. Bidders have been eager to get their hands on the company's 8,800 patents -- including crucial 3G and 4G/LTE patents to strengthen operating software for smartphones.
Some analysts have said that InterDigital has one of the best quality patent portfolios that remains on the market after bankrupt Nortel Network's sold its patents to a consortium led by Apple and Microsoft Corp last month.
Just over 50 percent of the current 3G market is already under license with InterDigital. Its partners include Samsung Electronics Co Ltd, Apple, Research In Motion Ltd and HTC Corp, among others. The company's 4G portfolio is relatively unlicensed.
InterDigital hired Evercore Partners and Barclays Capital on July 19 to explore strategic alternatives, including a possible sale of the company.
InterDigital declined to comment. The other potential bidders were not immediately available for comment.
(Reporting by Nadia Damouni; editing by Gerald E. McCormick and Gunna Dickson)
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