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Globecomm may be exploring a sale
Globecomm Systems Inc., a Hauppauge company that manufactures satellite communication devices, said Monday afternoon that the company plans to explore "strategic alternatives" after revising its fiscal year outlook.
Globecomm has hired investment bank Needham & Co. as advisers. Such a move typically indicates that the company is considering a sale. Globecomm, however, said in a news release that there is "no assurance" that the process will result in a transaction or change in the business model.
The company has been under pressure from shareholders to put the company up for sale in order to increase stock value.
JMB Capital Partners, an investment fund based in California, recently increased its stake in the company from 6 percent to 6.4 percent. In a regulatory filing, the fund also encouraged the company to explore a sale.
Emancipation Capital, a New York equity fund which owns about 5 percent of Globecomm, said in an October filing that it "believes the best interests of all of the shareholders and the maximization of shareholder value will be served only through an orderly, robust and public auction."
Globecomm stock reacted positively to the news, rising over 5 percent in morning trading to around $12.24 per share. The company's stock market value is around $285 million.
This isn't the first time that Globecomm has considered a sale -- the company hired J.P. Morgan as advisors in 2011 to explore possibilities.
The company's revised estimates for the rest of its fiscal year -- which ends June 30 -- were as follows:
-- Revenue is expected to be between $320 million and $340 million compared to former estimates of between $340 million and $360 million
-- Earnings per share expected to be between $0.66 and $0.71 compared to former estimates between $0.66 and $0.76.