Rambus up on M&A talk, Samsung says no plan to buy

NEW YORK/CHICAGO (Reuters) - Shares of memory chip developer Rambus Inc (RMBS.O) leapt 11 percent on Friday on renewed talk that Samsung Electronics (005930.KS) plans to buy the company, which the Korean company denied.

Rambus' options also traded briskly throughout the day, on talk that Samsung could pay $25 to $27.50 per share.

The U.S. chip designer's stock jumped as much as 14 percent in the morning before backtracking somewhat after the world's largest maker of memory chips and LCD screens poured cold water on the acquisition talk.

Rambus ended the day up 11.4 percent at $17.75. That followed a 15 percent slide on Tuesday, after a U.S. court ruled to postpone an antitrust trial that investors had been awaiting.

"Samsung Electronics has no intention to purchase Rambus," Chris Goodhart, a U.S.-based spokeswoman for Samsung, said.

Rambus would not comment on the acquisition speculation, which analysts say has surfaced in markets previously, without being substantiated.

"We've heard this rumor before. I don't find it likely," said Capstone Investments analyst Jeff Schreiner, who noted that a Rambus poison pill provision would protect the company from any hostile takeover lower than $60 a share.

Speculation that the Korean electronics giant is on the prowl for acquisitions comes after an aborted effort to take over another U.S. technology corporation.

On Thursday, Samsung said it had dropped efforts to buy memory chip maker SanDisk Corp (SNDK.O) for $5.9 billion, blaming SanDisk's deepening losses and uncertain outlook.

NO SENSE

Rambus is embroiled in legal wrangles with technology corporations around the world. The company -- which has spent some $300 million on legal disputes with chip makers since 2000 -- also claims graphics chip designer Nvidia Corp (NVDA.O) has not paid royalties on some of its patents.

Samsung itself is one of several chip makers, including Micron Technology Inc (MU.N) and Hynix Semiconductor Inc (000660.KS), facing an antitrust case from Rambus, which made accusations about price-fixing and hurting sales of its RDRAM memory chips used in computers.

That case had been set for a hearing at the end of this month. But on Tuesday, a judge ruled to delay the pivotal trial, which could have yielded billions of dollars in damages, till January, sending Rambus stock 15 percent lower.

Several analysts, however, said Rambus' stock was reacting to the Samsung talk on Friday.

While Schreiner said he had heard speculation of a price tag of $27.50 per share, Jon Najarian, a founder of optionMonster.com, cited rumors of a deal worth $25 to $27. Continued...

But Schreiner said a Samsung-Rambus merger would have antitrust ramifications because Samsung is the leader in the market for DRAM chips.

Najarian said rumors were common in the options market, but added there were very fast trades in Rambus front month September call options, notably the $17, $18, $19 and $20 strikes.

"Option traders focused their efforts on out-of-the-money calls in the near-term September contracts," said Andrew Wilkinson, senior market analyst at Interactive Brokers Group.

The most active contract was the September $20 calls giving the right to buy Rambus shares at $20 apiece. They traded 12,524 times on Friday, according to Reuters data.

About 74,000 call options traded in Rambus on Friday, about 3.5 times the average daily turnover and more than five times the put volume, according to options analytics firm Trade Alert.

(Reporting by Sinead Carew and Doris Frankel; Additional reporting by Ritsuko Ando in New York and Edwin Chan in Los Angeles; Editing by Steve Orlofsky, Leslie Gevirtz and Richard Chang)