Anadigics, Inc. ANAD announced the receipt of a revised buyout offer from an unnamed party, which will expire this Thursday. The increased acquisition interest in the company cheered investors, as shares spiked 7.3% in the trading session following the announcement.
The offer is under evaluation by the company’s Board of Directors.
Anadigics’ board is also considering an amended buyout proposal from an undisclosed third-party firm (a competing bidder to GaAs Labs) announced on Dec 23, which increased the per share offer price to 54 cents.
The counter offer was made by the competing bidder after GaAs Labs, LLC raised its offer price for semiconductor maker Anadigics from its previous 35 cents per share to 48 cents a share. GaAs Labs’ amended offer comes more than a month after Anadigics announced the buyout offer by privately-owned RF chipmaker GaAs Labs.
The two companies had inked a definitive merger agreement last month, under which GaAs Labs offered to acquire Anadigics for 35 cents per share, representing a premium of 38.2% based on the closing price as on Nov 11, 2015. However, the offer price was roughly 56% below Anadigics’ share price at the beginning of the year.
Under the terms of the agreement, Anadigics had a 25-day go-shop period during which it could solicit superior proposals. The chipmaker confirmed that there was acquisition interest that could translate into proposals with better terms than what GaAs Labs offered.
On Dec 16, Anadigics said it had received an offer from an undisclosed third-party firm to acquire all its outstanding shares for 48 cents a share. Consequently, GaAs Labs raised its offer price to match the offer by the competing bidder.
On Dec 23, Anadigics announced yet another superior buyout offer of 54 cents from the competing bidder. Per the terms of their merger agreement, GaAs Labs had two business days to match or exceed the competing bidder’s latest offer.
Whether the terms of the latest buyout offer from the excluded party is superior to all former offers will only be known after the company completes the evaluation.
Anadigics' third quarter numbers and recent operating performance help explain the rationale behind the company's decision to sell. In the last reported quarter, revenues fell 36% year over year, and the company reported a loss of $5.7 million. In fact, Anadigics has been incurring losses over the last few quarters and its revenues have deteriorated steadily.
However, investor interest in Anadigics has spiked lately, with shares appreciating nearly 140% since the announcement of the GaAs Labs merger.
Anadigics presently has a Zacks Rank #2 (Buy). Other players in the industry that are worth a look now include CEVA Inc. CEVA, Integrated Device Technology, Inc. IDTI and Mellanox Technologies, Ltd. MLNX, each sporting a Zacks Rank #1 (Strong Buy).
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