(Adds details in paragraphs 3-4, 8-10; stock prices)
PHILADELPHIA Nov 18 Chipmaker ON Semiconductor
Corp ONNN.O dropped its hostile offer to acquire Atmel Corp
ATML.O on Tuesday, leaving bidding partner Microchip
Technology Inc (MCHP.O) to look for other ways to pursue a deal
ON Semiconductor cited weakness in the semiconductor market
and the global financial crisis as reasons for walking away
from the joint $2.3 billion bid for Atmel.
Microchip said it was disappointed that ON Semiconductor
quit the joint bid. As a result of ON Semiconductor's
withdrawal, Microchip also had to drop its bid.
Microchip, however, said it "intends to evaluate its
potential alternatives for pursuing a transaction without ON
ON Semiconductor and Microchip Tech had made the joint
unsolicited bid to acquire Atmel in October, seeking to battle
slowing growth in the semiconductor market by combining
Atmel rejected the bid as too low, prompting ON
Semiconductor and Microchip Tech to launch a hostile bid for
Last week, Microchip Tech said it and ON Semiconductor
remained fully committed to their acquisition proposal and
planned to nominate a slate of directors at Atmel's annual
"The decision by Microchip and ON to withdraw their
unsolicited unfinanced proposal underscores our board's
determination that the proposal was highly conditional and
subject to significant execution risk," Atmel said in a
Atmel said it remained focused on its "transformation plan
to ensure that Atmel's stockholders fully realize the value
inherent in the company."
Shares of Atmel fell 62 cents, or 15.5 percent, to $3.37 in
morning trading. Shares of Microchip shed 95 cents, or 4.9
percent, to $18.53, while ON Semiconductor gained 15 cents, or
4.6 percent, to $3.42. All of the stocks trade on Nasdaq.
(Reporting by Jessica Hall; Editing by John Wallace and Brian