AMSTERDAM-Royal Philips Electronics Friday made a bid to acquire San Jose, Calif.-based
VLSI Technology Inc., a company that designs and manufactures custom and semi-custom integrated circuits for the
wireless communications and computing markets.
The proposal calls for VLSI shareholders to receive $17 per share
cash, which represents a premium of about 60 percent based on VLSI’s market price on Feb. 25, said Philips. VLSI’s
stock closed up $4.81 at $15.56 Friday.
In a letter from Cor Boonstra, president and chief executive officer of
Philips, to Alfred Stein, chairman and CEO of VLSI, Philips asked VLSI to respond to its proposal by the end of the
day Wednesday.
“This proposed acquisition is consistent with our strategy of looking for acquisitions which
strengthen our existing portfolio of the company, and also strengthen our presence in the United States,” said
Boonstra. The company last fall dissolved its partnership with Lucent Technologies Inc., which was formed to compete
in the wireless handset business and gave Philips a foothold in the U.S. market.
VLSI Feb. 1 announced it expects to
ship its single-chip Code Division Multiple Access dual-core baseband solution in March.
