IR rejects unsolicited $1.6B offer from Vishay
"Vishays proposal significantly undervalues the company and its future prospects when compared to the shareholder value realizable under our recently adopted strategic plan," said Richard J. Dahl, chairman of IR.
By Ann Steffora Mutschler, Senior Editor -- EDN, August 29, 2008
El Segundo, Calif-based International Rectifier Corp (IR) announced this morning that its board of directors has unanimously determined that the unsolicited proposal from Vishay Intertechnology Inc to acquire all outstanding shares of IR for $21.22 per share in cash is not in the best interests of IR and its shareholders.
The company noted that the proposal was reviewed with the assistance of its financial and legal advisers.
“Vishay’s proposal significantly undervalues the company and its future prospects when compared to the shareholder value realizable under our recently adopted strategic plan. On August 1, we announced that the company had successfully completed the restatement process of prior financial periods. The company has also added considerable strength and depth to its senior management team during the past year and is poised to enhance its competitive position in the marketplace,” commented Richard J. Dahl, chairman of the board of IR, in a statement.
“The board believes that the proposal by Vishay does not value the company and its future prospects appropriately. In our judgment, IR shareholders will be better served by allowing management to move forward with its strategic plan. We believe that IR’s valuation is still under the cloud of legacy issues. The board and our management team look forward to executing the exciting opportunities available to our company and to delivering this value to our shareholders,” Dahl added.
Further, Oleg Khaykin, IR CEO said, “We look forward to fulfilling our potential as we continue to follow our strategic plan and focus on long term value creation for our shareholders.”
This decision was communicated in a letter sent from Dahl to Vishay’s executive chairman of the board of directors, Dr. Felix Zandman and president and CEO, Dr. Gerald Paul, as follows:
August 28, 2008
Dr. Felix Zandman - Executive Chairman of the Board of Directors
Dr. Gerald Paul, President and Chief Executive Officer
Vishay Intertechnology, Inc.
63 Lancaster Avenue
Malvern, PA 19355-2143
Dear Dr. Zandman and Dr. Paul:
This is to provide you with a response from the International Rectifier Board of Directors to your unsolicited and non-binding proposal you made public on August 15, 2008 as well as your subsequent letter dated August 25, 2008.
The International Rectifier Board of Directors examined your proposal with the assistance of our financial and legal advisors.
The Board of Directors unanimously concluded that your proposal is inadequate, opportunistic and not in the best interests of International Rectifier and its shareholders. The proposal significantly undervalues the Company and its future prospects when compared to the value-creation strategy being implemented by our management team.
We also note that IR has only this month completed its financial restatement process related to legacy issues with which you are familiar and filed its Annual Report on Form 10K for the fiscal year ended June 30, 2007.
Having accomplished much during the past eighteen months to move through these legacy issues successfully, IR is now beginning to implement its turnaround strategy under the leadership of an outstanding new management team. We believe that this plan has the potential to create significant value for IR shareholders as the company enhances its competitive position in the marketplace.
In short, we believe IR shareholders will be better served by allowing management to move forward with its strategic plan.
We trust you will respect the decision of the Board of Directors.
Sincerely,
Richard J. Dahl
Chairman of the Board
Vishay did not respond to a request for comment by press time.
