Virage Logic launches bid to acquire LogicVision

IP provider proposes a $1.05 per share all-cash transaction that values the silicon-test provider at about $10 million.

By Matthew Miller, Editor in Chief, EDN.com -- Electronic News, 12/3/2008

After a November expression of interest got the cold shoulder, IP provider Virage Logictoday announced that it has sent the board of directors of LogicVisiona formal offer to acquire the company's outstanding stock for $1.05 per share, or about $10 million.

The all-cash proposal amounts to a 114% premium on LogicVision's Monday closing price of $0.49, according to Virage Logic. The stock was trading at $0.81 as of 10:30 am eastern this morning.

Virage released the text of a letterit sent to the LogicVision board on Tuesday, which begins by expressing disappointment in LogicVision's "unwillingness to engage in any substantive discussions" regarding an initial expression of interest on Nov. 10. Pulling no punches, the letter states, "Your refusal to engage in negotiations regarding a possible sale of the company appears to be premised on unrealistic expectations regarding the future prospects of LogicVision." Current economic conditions in the semiconductor market throw LogicVision's survival as a stand-alone public company into doubt, the letter further states.

Appealing to LogicVision's shareholders, Virage notes that LogicVision's share price has declined by 76% in the last 12 months. As for business benefits of the proposed acquisition, Virage cites "valuable synergies," presumably meaning that LogicVision's integrated silicon test expertise and products would complement its line of intellectual propertycores, which includes embedded SRAMs, embedded nonvolatile RAM, embedded test and repair, logic libraries, memory development software, and DDR memory-controller subsystems.