Maker of automatic teller machines (ATMs) and other security systems, Diebold Inc., is the target of a hostile takeover by United Technologies, which sees it as an opportunity to expand into the financial services industry.

According to Diebold’s press release:

Recently, the full Diebold board completed a detailed strategic review of the company and its prospects. At least three times in the last month, including this morning, the board met to discuss UTC’s interest in a potential business combination with the company. Given that Diebold has not filed financial statements since the company’s 10-Q for the quarter ended March 31, 2007, as previously reported, and that the company is working to become current in its filings with the Securities and Exchange Commission (SEC), the board believes that now is not the right time — and that it would not be in the best interests of the corporation or its shareholders — to pursue discussions with UTC.

United Technologies says its been trying to negotiate a deal with Diebold for about 2 years without success and now is making an offer directly to shareholders. Specifically, “65.8% premium to Friday’s closing price of $24.12,” according to Forbes.

Diebold has been struggling since last year because of an investigation by the Securities and Exchange Commission into its accounting practices for sales of ATMs. United Technologies thinks its can clean up the investigation and through acquisition, make the company profitable again.

However, Diebold’s board is standing firm and says that “. . . it would be irresponsible to engage in discussions with UTC at this time. We are confident that executing on our strategy will create substantially greater value for shareholders than UTC’s proposal . . .”

Related:

Entry was posted on Monday, March 3rd, 2008 at 4:54 pm under Security, Technology.

Read more entries by Matt Jansen.
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