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Technology Stocks : VLSI Technology - Waiting for good news from NASDAQ !!! -- Ignore unavailable to you. Want to Upgrade?

To: Linda Kaplan who wrote (5940)	3/23/1999 9:52:00 AM
From: Linda Kaplan	Read Replies (2) \| Respond to of 6565

Headline: VLSI Technology To Discuss Possible Takeover By Philips Electronics ====================================================================== AMSTERDAM -(Dow Jones)- U.S. semiconductor designer VLSI Technology Inc. sent a letter late Monday to Royal Philips Electronics NV requesting that representatives of the two companies meet to discuss a possible takeover by Philips. VLSI (VLSI) on Thursday formally rejected a hostile $777 million unsolicited $17-a-share tender offer from Philips. At the time, VLSI said its board unanimously concluded that the Dutch electronics giant's offer was inadequate, and recommended that VLSI shareholders reject the offer. Philips (PHG) spokesman Jeremy Cohen confirmed that VLSI subsequently sent a letter to Philips and said that VLSI "basically said that our investment bankers and lawyers should contact their investment bankers and lawyers." He added that the two companies would probably make contact sometime during business hours in the U.S. on Tuesday to arrange a meeting. Cohen noted that VLSI said it was holding preliminary discussions with other potential partners, but that VLSI hadn't made public any further information. In VLSI's rejection of Philips' offer last Thursday, VLSI said it would consider "strategic alternatives" to Philips' bid. Cohen said that Philips had seen that statement as a sign that VLSI would be willing to discuss an alternative offer by Philips. Philips, which launched its offer on March 5, has argued that it represents a 58% premium to VLSI's closing price of $10.75 a share on Feb. 25, the last trading day before disclosure of a letter to VLSI that first offered $17 a share. Because of VLSI's weak takeover defenses, Philips reportedly solicited shareholders directly to oust the board if VLSI didn't come to the table. Most companies incorporated in Delaware have removed the right of shareholders to oust directors via an immediate shareholder solicitation, but VLSI's charter allows for such a move. The battle has been closely watched because foreign companies rarely make hostile bids, and bidders rarely launch hostile missiles at high-tech companies because of the risk of losing precious employees. Though based in Europe, Philips has had a presence in Silicon Valley since 1975. Philips Semiconductors now has 1,500 employees in Sunnyvale, Calif. The San Jose Mercury News recently reported that VLSI's compensation for Chairman and Chief Executive Officer Alfred Stein and accounting issues may deter other companies from bidding for VLSI. Copyright (c) 1999 Dow Jones & Company, Inc. All Rights Reserved.