Tuesday, July 19, 2011

Zarlink Declines New Acquisition Bid from Microsemi

Microsemi Corporation announced a bid to acquire all of the outstanding shares of Zarlink Semiconductor for CAD $3.35 per share in cash. The deal has a total equity value of USD $548.7 million based on a fully diluted share count and represents a 40 percent premium to Zarlink's share price as of July 19, 2011, and a 43 percent premium to Zarlink's trailing 30 day average share price. Microsemi said this CAD $3.35 proposal exceeds every Zarlink closing share price over the last five years.

For its part, Zarlink issued a statement declining the offer. Zarlink noted that it received two previous unsolicited, non-binding expressions of interest from Microsemi dated May 20, 2011 and June 17, 2011 for CAD$3.00 and CAD$3.25 per share. The Zarlink Board, with the assistance of RBC Capital Markets and Canaccord Genuity, declined both of these previous offers, concluding that the Microsemi proposals significantly undervalued Zarlink and its future prospects and were not in the best interests of its stakeholders. Zarlink said this new offer of $3.35 per share does not change the conclusion.