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Wednesday, March 17, 2010

"Bidding War" Dynamics Shift

Sellers Fret Over Scaring Off Buyers

Interesting tidbit from today's Wall Street Journal (my paraphrase):

Whereas a few years ago the two rival Buyers might have been drawn into competitive bidding, this time the Seller "concluded that the risk of the first Buyer terminating its discussions with the Seller outweighed the benefits" of soliciting an offer from another Buyer.

A would-be home Seller trying not to scare off a prospective Buyer?

Not exactly.

The article, titled "Gap Widens Between Tech Richest and the Rest," discusses Starent Networks Corp. and its decision not to jeopardize an offer on the table from Cisco by soliciting a competing bid from Juniper Networks.

Starent accepted Cisco's $2.9 billion offer last October.

Subtract 5 zeroes, and the foregoing applies pretty well to today's housing market.

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