Engine Capital Warns Carbonite Not To Reject J2 Global Offer

(RTTNews) - Engine Capital LP, a large shareholder of Carbonite, Inc. (CARB), on Tuesday warned the data-backup provider not to reject the takeover offer from J2 Global, Inc. (JCOM) for tactical reasons as that would be playing with fire with other people's money.

Earlier this month, Carbonite received an unsolicited $15 per share buyout offer from internet services and media company J2 Global and said it would carefully review and consider the offer.

Engine Capital , which owns about 2.5% of Carbonite, wrote in a letter to the Carbonite board on Tuesday, "The way to create leverage is not by tactically rejecting the j2 Offer, but instead by publicly announcing the initiation of a sale process and engaging with potential bidders."

Engine Capital said J2 Global could significantly increase its offer for Carbonite because j2's market capitalization increased by more than $200 million the day of its proposal to buy Carbonite.

"The only way to know the maximum price j2 is willing to pay for the company is to negotiate with them. It would be meaningless to reject a $15 per share offer when the final number could be substantially higher," Engine Capital wrote in the letter.

In light of the recent $15 per share offer from j2 Global and considering how Carbonite summarily rejected a prior offer from j2 more than two years ago, Engine Capital had urged the Carbonite board earlier this month to immediately start a sale process.

Carbonite shares are currently trading at $13.49, up 2 cents.