InterDigital Inc (IDCC)

[The Count]

Paheka, nice post!!

From Nokia's perspective, it would make a lot of sense to buy out IDCC. They've been operating under the theory of why buy the cow when you can get the milk for free. However that time is rapidly coming to an end. So yes, I could see Nokia considering a buyout and trying to keep IDCC's share price down.

However I'm hoping that IDCC management would not entertain any offer that is not far, far higher than we are now. They can see the earnings stream forming and do the math to see what the stock will be worth. I would also hope that holders of the stock would not jump at a tender offer just because it looks good based on today's price.

You make a good point - a Nokia buyout could be a very profitable move on their part if they can buy IDCC cheap. I wouldn't mind them bidding up the price but I would probably be strongly against accepting the offer because I believe IDCC's value is a multiple of the current price, and once the contracts are signed it will be obvious to the street. So while I believe Nokia is smart enough to try it, I also believe IDCC is smart enough not to go for it.