NEW YORK - Shares of memory chip developer Rambus Inc rose 8 percent on Friday on speculation that rival Samsung Electronics would buy the company for $25 to $27.50 per share.
Rambus shares rose as high as $17.41 on the Nasdaq and its options traded briskly on Friday morning on the strength of the rumors. Rambus declined comment, and Samsung was not immediately available for comment.
We've heard this rumor before. I don't find it likely, said Capstone Investments analyst Jeff Schreiner, who noted that Samsung would likely be able to settle patent infringement fights with Rambus for less than the rumored price.
Samsung is also one of several companies that faces an antitrust case from Rambus, which has made accusations about price-fixing and hurting sales of its RDRAM memory chips used in computers. That case is expected to be heard next year.
Schreiner noted that a Samsung/Rambus merger would have its own antitrust ramifications because Samsung is the leader in the market for DRAM chips.
While Schreiner said he heard speculation of a price tag of $27.50 per share, Jon Najarian of optionMonster.com cited rumors of a deal worth $25 to $27.
Najarian noted that rumors were common in the options market but said there were very fast trades in Rambus front month September call options, notably the $17, $18, $19 and $20 strikes. The biggest concentration so far in the first hour of trade is the September $20 calls, giving the right to buy Rambus shares at $20 apiece, which traded 9,000 times.
These options are being aggressively bought on the offer, he said.
About 48,000 call options traded in Rambus, more than twice its average daily turnover near midday, according to option analytics firm Trade Alert.
Rambus shares rose $1.25 or almost 8 percent to $17.18 on the Nasdaq. (Reporting by Doris Frankel in Chicago and Sinead Carew in New York; Editing by Steve Orlofsky)