* Ups bid to $11 per share from $9.25
* Drops consent solicitation, urges friendly deal
* Says best offer it plans to make
* Emulex shares up 2.7 pct
(adds new details, Emulex response, analyst comment)
By Gabriel Madway
SAN FRANCISCO, June 29 Broadcom Corp (BRCM.O)
on Monday raised its cash tender offer for storage technology
company Emulex Corp ELX.N to $912 million and changed the
tenor of its previously hostile takeover bid in what it called
a final effort to engage Emulex's board.
Broadcom boosted its cash bid to $11 a share from $9.25 and
said it would extend its tender offer as required for an
additional 10 business days to July 14.
The wireless chipmaker said it was the best offer it
planned to make, and urged Emulex to support a friendly,
In a letter to Emulex's board, Broadcom Chief Executive
Scott McGregor asked the company to move swiftly on the new
offer, saying a delay would "erode the value of a
"This is especially so because Broadcom has other
value-creating opportunities. We believe it is in the interest
of each company's stakeholders to complete a transaction
expeditiously or to conclude that we cannot, and move on."
In response, Emulex issued a statement saying it plans to
review the new offer and make a recommendation to
Pacific Crest Securities analyst Brent Bracelin said the
bid represents a more serious offer by Broadcom.
"It clearly shows their intent to want to acquire the
Emulex asset. I think it's a fair valuation for Emulex, it
really puts the ball in Emulex's court as to whether the board
will legitimately consider the offer or not."
Abandoning its hostile approach, Broadcom plans to drop its
consent solicitation to Emulex's stockholders that sought to
amend company bylaws and hold a special shareholder meeting to
vote on the bid. Broadcom also said it does not plan to
nominate alternative candidates to Emulex's board.
In addition, Broadcom will abandon its lawsuit challenging
the validity of Emulex's supermajority voting bylaw and its
"poison pill" anti-takeover device.
Broadcom said its new bid of $11 a share represented a 66
percent premium to Emulex's closing share price on April 20 --
the day before Broadcom announced its initial offer. It was
only slightly above Emulex's closing price of $10.88 on
Emulex rejected the chipmaker's bid in May and has urged
shareholders to do the same, calling the earlier offer "grossly
Broadcom had twice extended the deadline of its tender
offer, which was attracting little support from shareholders.
Less than 3 percent of Emulex's outstanding shares had been
tendered when Broadcom last extended the deadline, on June 18.
Shares of Emulex rose 2.8 percent to $11.18 in after-hours
trading from their close of $10.88.
(Reporting by Gabriel Madway; editing by Carol Bishopric)