SoftKey International Inc. raised its hostile bid for Learning Co. to $65 a share, or $606 million, and changed the terms to all cash.
Analysts said SoftKey’s sweetened offer may be enough to beat rival bidder Broderbund Software Inc. If SoftKey succeeds, it would become the leading publisher of software to teach children how to read and write.
Learning Co., based in Fremont, Calif., already has agreed to be bought by Novato, Calif.-based Broderbund for more than $550 million. Broderbund and Learning Co. shareholders are scheduled to vote on the purchase Monday.
SoftKey, based in Cambridge, Mass., had been offering cash and stock valued at about $552.7 million, based on Friday’s closing stock price.
Learning Co. rose $3.12 a share to $63.50, a 5 percent gain. SoftKey also went up, gaining 62 cents a share to $29.62, while Broderbund dropped $2.62 a share to $62.12, a 4 percent decline.
SoftKey sells lower-priced games, most under $20. It is targeting mass-distribution outlets, including Sears, Roebuck and Co.
Last Thursday, Tribune Co., which publishes the Chicago Tribune, backed SoftKey’s bid, agreeing to invest $150 million in SoftKey if it succeeds in acquiring Learning Co. The pledge, at the time, was a signal that SoftKey was prepared to offer a sweetened bid.
Learning Co. filed a lawsuit in federal court in California seeking to block SoftKey’s bid. Among other things, Learning Co. alleges that SoftKey created “a misleading favorable picture of its financial performance” in documents sent to Learning Co. shareholders.
