Headline: FOCUS-Philips (AMS:PHG) bids $776.9 mln for VSLI (NASDAQ:VLSI)
======================================================================
(changes dateline, adds Philips' comment, analyst, updates
share price)
AMSTERDAM, Feb 26 (Reuters) - Dutch Electronics group
Philips (AMS:PHG) said on Friday it had offered to buy all the
outstanding stock of semiconductor firm VLSI Technology Inc.
(NASDAQ:VLSI) in a cash deal that could be worth about $776.9
million.
Philips said it had offered to pay $17 per share for some
45.7 million VLSI shares outstanding -- a premium of around 60
percent on the stock's Thursday closing price.
"We feel that the $17 is a fair price for the (VSLI)
shareholders," Philips spokesman Jeremy Cohen said, adding "If
you look at the reasons why we want to buy it, then it is a fair
price."
Philips said in a statement early Friday its bid was
consistent with its strategy of looking for acquisitions to
bolster its U.S. presence, adding it planned to make VSLI the
"cornerstone" of its growth strategy for Philips Semiconductors.
VSLI, based in San Jose, California, posted turnover from
continuing operations of around $550 million in 1998 while
Philips Semiconductors had full-year sales of 7.1 billion
guilders ($3.56 billion).
Cohen confirmed the acquisition, if accepted, would be
financed from existing resources. He declined to comment on
VLSI's likely response to the proposal or the atmosphere of
preliminary talks.
"We cannot really comment any further... the ball is in
VLSI's court," he said.
Analysts were upbeat on the potential acquisition, labelling
it an excellent fit for Philips if it went ahead.
"I think it's a perfect takeover and it's not even that
expensive," said Rene Verhoef of Generale Bank's Oyens & Van
Eeghen.
"I've had a look at the (VSLI) balance sheet and the
goodwill isn't actually that steep. Furthermore they've got a
good portfolio of products and excellent growth potential."
The news, which came out of the U.S. overnight, met a
lukewarm response on the Amsterdam Stock Exchange, however.
Philips shares traded flat over the session, standing down
0.39 percent at 63.50 euros by 1430 GMT.
fax +31 20 504 5040, amsterdam.newsroom@reuters.com))
($1=1.996 Guilder)
Copyright 1999, Reuters News Service |
