Broadcom raises hostile takeover offer for Emulex to $912 million

Chip designer Broadcom has raised its hostile bid for Emulex by 19 per cent to $912 million from the earlier $764 million.

Irvine- (California) based Broadcom raised its tender offer for all of the currently outstanding shares of common stock of Emulex Corporation from $9.25 to $11.00 per share in cash, representing a total equity value of approximately $912 million.

The offer represents a premium of 66 per cent to Emulex's closing stock price on 20 April 2009 and as required by law, Broadcom says it will extend its tender offer for an additional 10 business days to 14 July 2009 midnight New York City time.

Broadcom, the supplier of integrated circuits for broadband communications had earlier tried to acquire Emulex in April with an unsolicited offer of $764 million in cash (See: Broadcom launches $764-million hostile bid for Emulex), after having been rejected in December 2008.

The first time when Broadcom privately approached Emulex in December, the chip maker was sent packing by the board of Emulex saying that the company was not for sale.

Emulex, the Costa Mesa- (California) based company and leader in converged networking solutions for data centres, once again responded by rejecting Broadcom's $764-million hostile cash offer saying that the offer significantly undervalued Emulex's long-term prospects and did not adequately compensate stockholders for their shares.