Siebel mulls stock buyback

Siebel Systems may use some of the $2 billion in cash it's sitting on to buy up stock, as a group of disgruntled shareholders are urging it to do. Siebel is discussing the "buyback issue" with bankers and other advisors, Ken Goldman, Siebel's chief financial officer, said on Wednesday during an earnings call.

A group of shareholders that together own about a third of Siebel's stock are demanding the company buy at least $1 billion of outstanding shares. Unhappy with the company's declining stock price and profits, they're also asking the company to find a merger partner.

Goldman was mum on the merger issue when asked on Wednesday's call whether Siebel is looking for a buyer--a recurring rumor that recent management turmoil has revived. However, he downplayed the possibility that Siebel is saving its cash for a big acquisition of its own.

"Managing these things can be an extreme challenge when we're addressing core business efforts," Goldman said. "We are going to be careful."