Bel Fuse Questions Advisability Of Power-One Investment Agreement With Silver Lake
Bel Fuse Inc. announced that it has sent a letter to the Board of Directors of Power-One, Inc. questioning the advisability of acquiring more debt pursuant to its recently announced agreement with Silver Lake Sumeru, which Bel Fuse says potentially dilutes current shareholders by more than 75%.
Bel Fuse also expressed its alarm over Power-One’s continued refusal to consider strategic alternatives, including the divestiture of one or more of its business units, even though Power-One’s stock continues to perform, in Bel’s words, "abysmally."
"The Silver Lake transaction illustrates Power-One’s insistence on sticking with what we believe has proven and continues to be a losing strategy: the incurrence of expensive debt and the refusal by the Company to divest of one or more of its business units in order to reduce debt. Moreover, the Silver Lake transaction will result in substantial dilution to the Company and will, in our view, adversely impact the Company’s stock price, to the detriment of all of its stockholders," said Daniel Bernstein, Bel’s CEO and President.
As of press time, Power-One had not responded to the Bel Fuse letter.