Chipmaker Dialog Semiconductor has hit back against against a campaign by US activist hedge fund Elliott, which is trying to block the London-listed company's acquisition of its US rival Atmel for around $4.6bn.
Elliott is urging other shareholders to vote against the takeover at a shareholder meet on November 19.
Elliott's concerns are based around the deal multiple and the integration of the US company. "The move is a big fish to swallow from a deal multiple, financial and integration point of view," Reuters reported the hedge fund as saying earlier this week.
On Wednesday, the board of Dialog published a response to Elliott's concerns, claiming that the activist's motivations "appear to be based on a short-term risk arbitrage trade rather than long-term shareholder value creation".
The company said it is "encouraged" by the level of support it appears to have from other shareholders for the deal. The takeover, it argues, is a "strategically important transaction".
From Dialog's response:
The transaction diversifies Dialog's existing customer concentration, increases Dialog's addressable market size, positions Dialog to capitalise on the large and growing Internet of Things (IoT) opportunity, creates significant cost and revenue synergy potential and results in a company that will be a leader in markets that are profitable and growing rapidly over the next several years.