Irvine-based chipmaker Microsemi Corp. might have some competition as it pursues a hostile bid for Canada’s Zarlink Semiconductor Inc.
New suitors have entered the ring for the Ottawa-based Zarlink, which makes chips used by telecommunications and cable companies for bundled voice, video, data and mobile services, according to a Reuters report.
Zarlink Chairman Adam Chowaniec told Reuters that the company has drawn interest among other competitors and strategic buyers, although a decision to remain independent is still a possibility.
Last week Microsemi Corp. said it will take a $548.7 million cash bid for Zarlink to shareholders after directors of the company turned down two earlier offers.
“Your continued refusal to discuss our proposal compels us to directly inform your shareholders of our attractive proposal,” Microsemi Chief Executive James Peterson wrote in a letter to Zarlink’s board.
Microsemi has made three proposals since January.
Its latest offer for Zarlink is a premium of about 40% based on recent prices on the Toronto Stock Exchange.
The hostile bid aims to extend Microsemi’s lineup in the communications and medical markets.
Zarlink counts on the communications sector for about 80% of its business and the medical sector for most of the rest. Its medical business makes ultra low-power radios for devices such as pacemakers.
Microsemi’s chips serve a variety of military, aerospace, consumer and industrial uses. Its products are built into satellites, digital televisions and other devices. Customers include Cisco Systems Inc., Boeing Co., Hewlett-Packard Co., Dell Inc. and Samsung Elec-tronics Co.
Microsemi is a frequent acquirer, and buys are key to the company’s current goal on revenue.
Microsemi typically buys several companies a year as part of a rollup strategy in what are known as high-reliability chips used in devices where failure is costly.
The company now is Orange County’s third-biggest chipmaker by sales and reported about $520 million in revenue for the 12 months through October.
Microsemi shares were down 3% at the close of New York trading Wednesday to a market value of about $1.7 billion on a down day on Wall Street as investors seized upon macroeconomic concerns and gridlock on the debt ceiling discussions in Washington.