Class action lawsuits filed against Axcelis
PHILADELPHIA Feb 28 (Reuters) - Two class action lawsuits were filed on Thursday against Axcelis Technologies Inc (ACLS.O) following the semiconductor-equipment maker's rejection of a $532 million takeover bid from Japan's Sumitomo Heavy Industries Ltd (6302.T).
The lawsuits contended that Axcelis and its board of directors breached their fiduciary duty and failed to act in the best interest of its shareholders by refusing to hold merger talks with Sumitomo.
Copies of the lawsuits were received by Reuters.
Axcelis could not be immediately reached for comment.
Earlier this month, Sumitomo made an unsolicited bid to buy Axcelis, which had rebuffed requests for merger talks for about 18 months. U.S. private equity firm TPG Group [TPG.UL] would be a minority partner with Sumitomo in making the bid.
Axcelis on Monday rejected Sumitomo's offer, saying the bid undervalued the company and failed to acknowledge Axcelis's "prospects for reclaiming its market share and creating value for its shareholders."
By refusing to enter merger talks with Sumitomo, Axcelis and the board "have failed to exercise ordinary care and diligence in the exercise of their fiduciary obligations," according to one lawsuit, filed in the Superior Court for the Commonwealth of Massachusetts.
Axcelis's board and management rebuffed talks with Sumitomo "in an attempt to entrench themselves in their positions with the company and to protect their substantial salaries and prestigious positions," according to the Massachusetts lawsuit.
The Massachusetts suit, filed by Axcelis shareholder Martin Meltzer, asked the court to direct Axcelis to consider "any proposed business combination that would maximize the company's shareholder value." Meltzer owns about 5,000 shares of Axcelis stock, according to the lawsuit.
The second lawsuit, filed in the Court of Chancery of the state of Delaware, sought a court order to force Axcelis "to engage in a proper process to maximize value for the class and enjoin defendants from unlawfully entrenching themselves in their positions of control."
"In addition to painting Sumitomo as a predator seeking to take advantage of the company's vulnerable position ... (Axcelis Chairman Mary) Puma reiterated the company's bright future prospects as an excuse for the board's entrenchment," according to the Delaware lawsuit.
Axcelis and its board "have not and are not exercising independent, fully informed business judgment and have acted and are acting to the detriment" of shareholders," the Delaware lawsuit said.
The Delaware lawsuit was filed by Axcelis shareholder Shirley Simon. The suit did not detail how many shares Simon owned. (Reporting by Jessica Hall; Editing by Lincoln Feast) (For more M&A news and our DealZone blog, go to here)