Dimensional Associates has once again raised its bid to purchase digital distributor The Orchard and take the company private. Dimensional which is the private equity arm of JDS Capital and also owns eMusic, is alrady The Orchard's majority stock holder.
From an initial offer of $1.68 a share, Dimensional had up their bid to $1.84 and have now according to a recent SEC filing they have raised it a $2 a share. The Orchard’s “special committee” is evaluating the offer. The stock closed Thursday at $1.79.
Dimensional had owned 100% of The Orchard prior to a 2007 merger with the publicly traded Digital Music Group. The combined companies trade on the NASDAQ as The Orchard (ORCD). In September, the company lost popular president and CEO Greg Scholl to NBC Universal where he became President of local media platforms.
ANALYSIS:
But what is Dimensional's end game?Some point to a combination with eMusic to complete the value chain. But with eMusic openly seeking a buyer, any link with The Orchard is may be more designed to enhance a future sale. If The Orchard's "special committee" and non-Dimensional stock holders believe the same, then taking The Orchard private may not happen without Dimensional having to further increase its offer once again.
