Zarlink adopts poison pill to ward off hostile $548.7 million bid from Microsemi
26 Jul 2011
Canada's Zarlink Semiconductor yesterday adopted a "poison pill" shareholder rights plan to ward off a hostile $548.7 million cash bid from US-based rival Microsemi Corp, a maker of microchips for the aerospace and defence industries.
The "limited duration" plan prevents any person from acquiring more than 20 per cent of Zarlink's voting rights.
After rejecting its two earlier offers, Irvine, California-based Microsemi, last week went public with its C$3.35 ($3.54) a share bid, which was once again rejected by the Ottawa-based Zarlink, whose clients include Alcatel-Lucent, Cisco Systems and Juniper Networks among others. (See: Microchip maker Microsemi launches $548.7 million hostile bid for Zarlink)
Microsemi's cash offer is a premium of 40-per cent to Zarlink's closing price of C$2.39 on 20 July.
Microsemi first approached Zarlink in January with an offer of C$3.00 per share, which was rejected by Zarlink and later again rebuffed without discussion when Microsemi raised the offer to C$3.25-C$3.55-a-share bid.
Microsemi said it reduced its bid ''due to the added costs associated with pursing this transaction in a public manner and the inability for Microsemi to perform diligence.''
