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Technology Stocks : Silicon Motion Inc. (SIMO) -- Ignore unavailable to you. Want to Upgrade?

To: Elroy who wrote (2670)	7/27/2023 12:08:15 PM
From: Elroy	Read Replies (1) \| Respond to of 2977

The thing I wonder about now is if SIMO wins in arbitration, and forces MXL to try to close the deal, but MXL cannot get financing for the $3 billion cash portion of the deal......what happens? $160m break up fee, or some larger penalty? My guess is larger penalty, which in the worst case for MXL may be 100% of MXL's equity (currently worth $1.7 billion) is owed to SIMO shareholders. But if that's a possible outcome, why in the world would MXL pursue such a bizarre path? MXL management on their call yesterday seemed to believe that if they just accuse SIMO of Material Damaging Effect, then the deal is off without a hitch. My gut says there is no Material Adverse Effect by SIMO, but since MXL gave zero details it's hard to evaluate. The consensus view of my research indicates reduced revenues in and of itself is not a Material Adverse Effect. So....what is MXL talking about? I guess we have to wait for arbitration hearings to find out what MXL's theory is about this whole thing.