Looks like it wasn't a week, but 45 days that VLSI wanted. Their letter to Phillips is MOST interesting:
VLSI Continues Strategic Alternatives Process
-- No Agreement Reached with Philips to Participate in Process --
SAN JOSE, Calif., March 29 /PRNewswire/ -- VLSI Technology, Inc. (Nasdaq: VLSI) announced today that VLSI has not reached an agreement with Royal Philips Electronics which would allow Philips to participate in VLSI's exploration of strategic alternatives. Despite extensive discussions between the two parties' advisers, no agreement has been reached.
VLSI stated that VLSI has reached agreements granting other parties access to non-public information concerning VLSI. VLSI also has established a data room and has granted extensive senior management interviews to third parties.
"Philips asked to be included in our process of exploring VLSI's strategic alternatives and VLSI worked with Philips to develop reasonable terms to include Philips," said Alfred J. Stein, chairman and chief executive officer of VLSI. "It is unfortunate that Philips has declined to participate in our process because we believe that, by their participation, Philips would recognize that Philips' offer does not reflect the strong business potential of VLSI and therefore is inadequate."
The text of a letter sent today by Mr. Stein to Mr. Cor Boonstra, president and chief executive officer of Royal Philips Electronics, is as follows:
By Facsimile
March 29, 1999
Mr. Cor Boonstra
President & CEO
Royal Philips Electronics
Rembrandt Tower
Amstelplein 1
1096 HA Amsterdam
The Netherlands
Dear Mr. Boonstra:
I was disappointed to hear from my advisory team that VLSI and Philips
were unable to reach an agreement that would allow Philips to participate
as one of the companies exploring strategic alternatives with VLSI.
When Philips asked to participate in VLSI's process, VLSI's advisers
devoted significant time to the issue and the VLSI Board of Directors
held a special meeting to discuss the terms under which Philips could
gain access to non-public information concerning VLSI and its business.
The agreement VLSI ultimately proposed -- essentially a 45-day truce
between the two companies -- was quite simple:
-- In exchange for the same access to non-public information and
senior management that VLSI made available to other parties in
the process, Philips would agree to take no action concerning
its tender offer and consent solicitation until May 10, 1999.
-- VLSI would set May 10, 1999 as the record date for both its
consent solicitation and 1999 Annual Meeting of Stockholders,
and would hold the Annual Meeting on June 8, 1999.
-- In addition, to preserve Philips' flexibility, VLSI would agree
that the 45-day standstill would terminate if VLSI entered into
a strategic transaction with a party other than Philips.
It is unfortunate that Philips has declined to participate in VLSI's
process because we believe that, by Philips' participation, Philips would
recognize that Philips' offer does not reflect VLSI's excellent
technology and strong business potential. Our customer product bookings
have strengthened. For example, after the commencement of your offer,
VLSI received the largest single order in VLSI history. By remaining
outside of VLSI's process, Philips may continue to make inaccurate
assumptions about VLSI's business.
The other Directors of VLSI and I remain ready to include you in our
process of exploring strategic alternatives.
Very Truly Yours,
Alfred J. Stein
Chairman and CEO
VLSI Technology, Inc.
As announced on March 18, 1999, the VLSI Board of Directors unanimously determined that the unsolicited cash tender offer by Philips for all of the outstanding shares of VLSI at $17.00 per share is inadequate and not in the best interests of its stockholders, and therefore unanimously recommended that VLSI's stockholders reject the Philips offer and not tender their shares to Philips. The VLSI Board also unanimously determined that VLSI should explore its strategic alternatives, including a merger, sale or recapitalization of VLSI. The VLSI Board said those alternatives could include negotiations with interested parties, including Philips.
VLSI Technology, Inc. designs and manufactures custom and semi-custom integrated circuits for leading firms in the wireless communications, networking, consumer digital entertainment and advanced computing markets. The company is based in San Jose, Calif. with 1998 revenues from continuing operations of $547.8 million, and approximately 2,200 employees worldwide. Information related to VLSI Technology is available at VLSI's homepage, vlsi.com.
SOURCE VLSI Technology, Inc.
CO: VLSI Technology, Inc.; Royal Philips Electronics
ST: California
IN: TLS
SU:
03/29/99 00:01 EST prnewswire.com |
