VLSI holders sue board to compel merger response
WILMINGTON, Del., March 8 (Reuters) - VLSI Technology Inc <VLSI.O> shareholders have filed at least six similar class action lawsuits in Delaware against the company and its board to compel their cooperation with any potential acquirer,including Philips Electronics NV <PHG.AS>.
Shareholders, who began filing the suits on Thursday in the Delaware Chancery Court, referred to a March 1 story in the Wall Street Journal about Philips' intention to acquire VLSI, a California chipmaker.
On Friday, Philips launched an all cash, all shares hostile tender offer of $17.00 a share to VLSI stockholders, a 58 percent premium over the stock closing price on February 25, the day before Philips first made public its merger proposal. VLSI said it has scheduled a board meeting March 23 to consider the offer.
In one of the suits filed Thursday in the Delaware Chancery Court, plaintiff Felicia Bernstein accused the board of "foot dragging."
"Defendants' failure to promptly and properly act upon Philips offer evidences their disregard for the premium being offered to VLSI shareholders. By failing to properly pursue the offer, defendants are depriving (Bernstein and the class)...of the opportunity to receive maximum value for their shares," the lawsuit says.
In addition to asking the court to compel cooperation with any potential acquirer, the lawsuit wants VLSI to ensure that if any conflicts-of-interest do exist on the board, they be resolved "in the best interests of the public stockholders of VLSI."
Claims in the other lawsuits filed through Friday were similar.
19:21 03-07-99
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