Arbinet-thexchange, Inc. (NDAQ:ARBX) is a takeover candidate that has not received much press. Two days ago, Singer Children's Management Trust disclosed a 7.04% stake in the company and expressed its concern over the company's future. Particularly, the hedge fund believes it is in the best interest of shareholders for the company to pursue a sale.

Around October 23, 2006, the company formed a special committee to review strategic alternatives and hired Jefferies & Company as its financial advisor. These strategic alternatives included a possible sale or merger of the company. Seven months later, however, shareholders are still waiting for the results. Singer demanded that if the company has tangible results, including a potential buyer, they should immediately disclose it to shareholders.

Is the company simply delaying the announcement of an unsuccessful review? Well, Tom Watts, an analyst with Cowen & Co. suggested that there is demand for a company like Arbinet after the $55 million merger last year of the international wholesale voice business of Royal KPN with iBasis. He said it is just a matter of finding those potential buyers and seeing what they're willing to pay. Morover, the company's former chairman and CEO indicated he would pursue a bid for the company, but has not publicly disclosed an offer.

So, where do things stand now? In a conference call on Tuesday to discuss first-quarter earnings, CEO Curt Hockemeier declined to discuss the company's strategic review, saying only that it continues. We do know, however, that its professional fees increased to $1.1 million stemming from the review! Whether or not the company has found a buyer remains to be seen, but patience is quickly running out...

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