Broadcom Corporation (NASDAQ:BRCM) announced that they have made an unsolicited offer to acquire Emulex Corporation. The offer was $9.25 per share at a total deal worth $764 million. The $9.25 offer is worth 40% over the closing price of the stock on April 20.
Broadcom believes that ?its leadership in Ethernet networking, together with Emulex?s deeper expertise in Fibre Channel storage networking, will enable the combined company to accelerate the development of converged solutions for enterprise networks.? The deal would be in cash and securities. Below is a portion of the press release that Broadcom released in the conflict that they had with Emulex in the past.
As you know, we have believed for some time that a combination of our two companies would benefit both companies? shareholders and the customers we serve. With that strategic opportunity to meet the needs of the market in mind, we sought to engage you and your Board of Directors in discussions in late December regarding a potential combination of Emulex with Broadcom. We were disappointed when, in early January, you responded that the company was not for sale and abruptly cut off the possibility of further discussions. Even more troubling was the fact that merely one week after that communication, you took actions clearly designed to thwart the ability of your shareholders to receive a premium for their shares. These included adopting a ?poison-pill? and amending your bylaws. It is difficult for us to understand why Emulex?s Board of Directors has not been open to consideration of a combination of our respective companies. We would much prefer to have engaged in mutual and constructive discussions with you. However this opportunity is in our view so compelling we now feel we must share our proposal publicly with your shareholders.
Broadcom filed a suit in Delaware Chancery Court against Emulex in order to seek the overturn the recently amended bylaws.