Atmel has rejected an unsolicited bid from Microchip Technology Inc and ON Semiconductor proposing a joint acquisition of the company for $5 per share in cash, a total value of approximately $2.3 billion

"Atmel's board has determined that Microchip and ON's highly conditional proposal significantly undervalues Atmel and would deprive Atmel stockholders of the greater value that can be achieved through the continued execution of the company's transformation plan," said David Sugishita, chairman of San Jose-based Atmel, in a statement this week.

In making their original proposal, the two Arizona-based companies said the deal would be financed in part by the sale of Atmel's nonvolatile memory and RF and automotive businesses to ON Semi. 

Although not a condition of the offer, Microchip had further intended to dispose of Atmel's ASIC business if the proposed acquisition had gone through. To that end, Microchip said in the offer that it was "confident" it could divest the business and noted that it has already engaged in discussions with a third party interested in acquiring the ASIC unit.

Atmel this week described the offer as one that is "inadequate in multiple respects, including value, conditionality and complexity" and one that "is not in the best interests of Atmel's stockholders."

By: DocMemory
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