March 10 A Chinese state-owned company offered
to buy Montage Technology Group, a Shanghai-based
chipmaker, in a deal valued at about $600 million, roughly four
months after failing to buy rival RDA Microelectronics Inc
Shanghai Pudong Science and Technology Investment Co Ltd
offered $21.50 per Montage share in cash, a 25 percent premium
to the company's closing price on Friday.
Shares of Montage, which counts Intel Corp among
its top shareholders, were up 19.5 percent at $20.51 in early
trading on the Nasdaq.
The fabless chipmaker, which went public at $10 per share in
September, makes analog and mixed-signal chips for set-top boxes
and servers for cloud computing, and counts the world's four
largest DRAM chipmakers as its customers.
Topeka Capital Markets analyst Suji De Silva said it was
difficult to predict if there would be rival offers since
Montage was not a cellphone-focused chipmaker, unlike RDA and
Spreadtrum Communications Inc.
"But the price seems low, so there could be chance of
topping up," De Silva said.
China, home to the largest number of mobile phone users in
the world, is investing heavily to improve its broadband
That was one reason Shanghai Pudong Science, owned by the
Pudong New Area government of Shanghai, offered to buy RDA in
September. But its offer was topped by Tsinghua
University-funded Tsinghua Unigroup Ltd with a bid of $910
Tsinghua also said in July it would buy Spreadtrum for a
raised offer of about $1.78 billion.
Montage last month came under fire from short-seller Gravity
Research which said the company's revenue was "significantly
lower" than reported, and that one of its largest distributors
was "nothing more than a shell company."
Montage has refuted the allegations.
The company, which had 28 million shares outstanding as of
Dec. 31, counts Samsung Electronics and Micron
Technology Inc among its customers.