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Microchip still seeks Atmel acquisition

Posted: 18 Dec 2008     Print Version  Bookmark and Share

Keywords:semiconductor industry  acquisition  transaction 

Microchip Technology Inc. has apparently not completely given up on the idea of acquiring rival Atmel Corp. as it announced a slate of seven new nominees for Atmel's board of directors.

Steve Sanghi, Microchip president, chairman and CEO, said through a statement that Microchip was proposing the nominees in advance of the Dec. 16 deadline "in order to preserve Microchip's flexibility as we evaluate our alternatives with respect to a potential transaction with Atmel."

But Sanghi added that, in light of current economic conditions and a semiconductor industry downturn, Microchip is still undecided about pursuing an acquisition of Atmel.

Earlier this year, Microchip and On Semiconductor Corp. proposed a Rs.11,508.37 crore ($2.3 billion) takeover bid for Atmel. The proposal was rejected b0079 Atmel's board, prompting Microchip and On Semi to say they would take the case directly to Atmel's shareholders through a proxy vote.

But On Semi reversed course last month and bowed out of the fight for Atmel, citing deteriorating market conditions. At the time, Sanghi said Microchip would continue to evaluate alternatives for pursuing a transaction without On Semi.

Atmel issued a statement Dec. 15 saying replacing its current directors is not in the best interest of shareholders. Microchip's move only serves to advance its agenda as a major competitor, Atmel said.

"It is unfortunate that after withdrawing its inadequate, opportunistic and highly conditional acquisition proposal just six days after publicly stating that it was 'fully committed,' Microchip has now chosen to potentially pursue a costly and disruptive proxy contest merely 'to preserve Microchip's flexibility,' " the statement read.

Microchip's nominees to Atmel's board of directors are:

• Jonathan Brooks, former chief financial officer and a Director of Glotel plc.
• Dan Casey, currently the CEO of Sonomax Hearing Healthcare Inc.
• G. Carl Everett Jr., a partner at venture capital firm Accel Partners and a founder of venture advisement firm GCE Ventures.
• Michael L. Hackworth, former chairman and CEO of Tymphany Corp.
• Robert S. Pepper, a 47-year semiconductor industry veteran who was a VP of Intel Corp.'s network communications group and president/chief technology officer of Level One Communications.
• Alan G. Rieper, former managing director and senior semiconductor analyst at investment bank Credit Suisse First Boston.
• Andrew Sukawaty, chairman and CEO of Inmarsat Plc.

- Dylan McGrath
EE Times

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