21 September 2015

GSI's board rejects latest acquisition proposal from GigOptix

GSI Technology Inc of Sunnyvale, CA, USA - a provider of static random access memory (SRAM) products primarily incorporated in networking and telecoms equipment - says that its board of directors (in consultation with its financial and legal advisors) has unanimously determined to reject the unsolicited, non-binding and conditional proposal made on 4 June by GigOptix Inc of San Jose, CA, USA (a fabless supplier of analog semiconductor and optical communications components for fiber-optic and wireless networks) to acquire GSI for $6.50 per share, consisting of a combination of GigOptix common stock and cash (including GSI's cash paid as a special dividend). 

The proposal represented a 26% premium above the closing price of GSI's stock of $5.14 on 2 June (amounting to about 3.5 times revenue and 4.0 times GSI's enterprise value), according to GigOptix at the time.

"Representatives of our management and several members of our board of directors, along with our financial and legal advisors, held meetings with you and your advisors to provide you and your team with an opportunity to clarify your proposal, provide additional information regarding the financing commitment referred to in your letter and demonstrate why you believed that the proposed transaction was in the best interests of our stockholders," said GSI's lead director Arthur O. Whipple in a letter to GigOptix's chairman, CEO & president Avi Katz. "We entered into a mutual nondisclosure agreement, although you did not request, and we did not provide GigOptix with, any non-public information regarding GSI Technology. At our most recent meeting on 31 August 2015, you substantially revised your proposal by, among other things, reducing the per share consideration to $5.04 per share," he added.

"After carefully and thoroughly reviewing your revised proposal, in consultation with its financial advisors Robert W. Baird & Co Incorporated and its legal advisors DLA Piper LLP (US), our board has unanimously concluded that further pursuit of your unsolicited proposal would not be in the best interests of our stockholders," continued Whipple. "The board believes that GSI Technology's prospects as a strong independent company are excellent and that our goal of continuing to build long-term stockholder value will be best served by remaining focused on the execution of our business plan." 

See related items:

GigOptix renews interest in acquiring GSI for $6.50 per share

GigOptix withdraws proposal to acquire GSI

GSI rejects proposed acquisition by GigOptix

GigOptix proposes to acquire memory product firm GSI for $161m

Tags: GigOptix

Visit: www.gsitechnology.com

Visit: www.gigoptix.com