A pair of Arizona semiconductor companies made an unsolicited bid Thursday to buy San Jose chip maker Atmel in a $2.3 billion deal that would split the assets between the two buyers.
Microchip Technology and ON Semiconductor announced the $5-a-share cash offer in a letter to Atmel’s board, saying the San Jose company had rejected a previous overture that Microchip Chief Executive Steve Sanghi extended to Atmel CEO Steven Laub on Sept. 5.
While the bid represents a significant premium for Atmel shareholders, one analyst predicted it would be rejected and could lead to a lengthy proxy battle.
“We believe Atmel should negotiate to get a deal done as meaningful synergies exist between the three firms,” analyst Craig Berger of FBR Capital Markets wrote in a note to investors, while adding that he expects Atmel’s board to insist on a price closer to $6 a share.
A call for Google-Yahoo scrutiny: A key senator is urging the Justice Department to keep up its investigation into the antitrust implications of the Internet advertising partnership that Google and Yahoo plan to launch this month.
The deal will see Google sell some of the ads displayed alongside search results on Yahoo’s Web site. Yahoo embraced the idea as an alternative to a takeover by Microsoft.
The Justice Department is already examining the deal to decide whether to intervene. In a letter today, Wisconsin Democrat Herb Kohl, chairman of the Senate Judiciary antitrust subcommittee, said his panel concluded that “important competition issues are raised by this transaction.” He urged the Justice department to “continue to monitor the state of competition in this industry.”
Take-Two stays independent: Take-Two Interactive Software, the maker of the top-selling “Grand Theft Auto” video games, decided to remain independent after takeover talks with Electronic Arts ended last month.
The company reached the decision after conducting a review of alternatives and talking with interested parties, New York- based Take-Two said Thursday in a statement. The video-game maker has positive cash flow and no debt, Chief Executive Officer Ben Feder said in the statement.
After considering management presentations and conducting its own review, EA said on Sept. 15 that it wouldn’t bid on Take-Two. EA had previously dropped a $2 billion hostile offer for the company, an attempt to capture holiday sales of “Grand Theft Auto IV.”
Silicon Valley tech stocks:
Up: Genentech
Down: Adobe, Apple, Borland, Cisco, Hewlett-Packard, Sun Microsystems and Xilinx
The tech heavy Nasdaq composite index: Down 92.68, or 4.48 percent, to 1,976.72.
The blue-chip Dow Jones industrial average: Down 348.22, or 3.22 percent, to 10,482.85.
And the Standard & Poor’s 500 index: Down 46.78, or 4.03 percent, to 1,114.28.
Check in weekday afternoons for the 60-Second Business Break, a summary of news from Mercury News staff writers, the Associated Press, Bloomberg News and other wire services.
