International Rectifier Corp. (IR) announced that its Board of Directors has unanimously determined that the unsolicited, non-binding proposal by Vishay Intertechnology, Inc. to acquire all of the outstanding shares of IR for $21.22 per share in cash is not in the best interests of IR and its shareholders. The Board reviewed the proposal with the assistance of its financial and legal advisers Goldman, Sachs & Co. and Fried, Frank, Harris, Shriver & Jacobson LLP, respectively.
Richard Dahl, Chairman of the Board of International Rectifier commented, "Vishay’s proposal significantly undervalues the company and its future prospects when compared to the shareholder value realizable under our recently adopted strategic plan. On August 1, we announced that the company had successfully completed the restatement process of prior financial periods. The company has also added considerable strength and depth to its senior management team during the past year and is poised to enhance its competitive position in the marketplace. The Board believes that the proposal by Vishay does not value the company and its future prospects appropriately. In our judgment, IR shareholders will be better served by allowing management to move forward with its strategic plan. We believe that IR’s valuation is still under the cloud of legacy issues. The Board and our management team look forward to executing the exciting opportunities available to our company and to delivering this value to our shareholders."
The Board of Directors communicated its decision in a letter sent from Dahl to Vishay’s Executive Chairman of the Board of Directors, Dr. Felix Zandman and President and Chief Executive Officer, Dr. Gerald Paul. Portions of the text of the letter follow:
"The Board of Directors unanimously concluded that your proposal is inadequate, opportunistic and not in the best interests of International Rectifier and its shareholders. The proposal significantly undervalues the company and its future prospects when compared to the value-creation strategy being implemented by our management team.
"We also note that IR has only this month completed its financial restatement process related to legacy issues with which you are familiar and filed its Annual Report on Form 10K for the fiscal year ended June 30, 2007.
"Having accomplished much during the past eighteen months to move through these legacy issues successfully, IR is now beginning to implement its turnaround strategy under the leadership of an outstanding new management team. We believe that this plan has the potential to create significant value for IR shareholders as the company enhances its competitive position in the marketplace.
"In short, we believe IR shareholders will be better served by allowing management to move forward with its strategic plan."
