It looks like Golden Gate Capital will win Conexant Systems.
Today, Conexant said its board has deemed a bid from Golden Gate, the San Francisco PE firm, as a “superior proposal.” Earlier this month, Conexant received a “revised written proposal’ from Golden Gate to buy all of its outstanding shares for $2.40 each cash, or roughly $300 million.
Lest you have forgotten, Conexant already has a deal on the table from Standard Microsystems. In January, Standard Microsystems offered to buy the company for $2.25 a share, or $284 million (including debt). This seemed like a done deal in January until Golden Gate swooped in with a rival (higher) offer for Conexant a month later.
Newport Beach, Calif.-based Conexant is a communications and network chipmaker serving the imaging, audio, embedded modem and video surveillance markets. The company is losing money. Earlier this month, the company reported a first quarter net loss of about $9.7 million, compared to $8.3 million in profit for the year-earlier quarter.
Yesterday, Conexant alerted Standard Micro of its decision. Standard Micro has four business days to respond and come in with a higher offer. Standard Micro, which reportedly has $160 million in cash, is expected to boost its offer but not engage in an all out bidding war of Conexant.
When asked if Standard Micro would come in with a higher offer, a spokeswoman didn’t really answer. “SMSC has not issued a public statement at this time,” the spokeswoman wrote in an emailed response to questions.
So why all the interest in Conexant? Well, Golden Gate has ties to the company. Dan Artusi, who is the former CEO of Conexant, is currently an operating exec at Golden Gate. Artusi “suddenly” left the Conexant in April 2008 and is believed to have spreaheaded the buy of Conexant.