Saifun chairman and CEO Dr. Boaz Eitan admitted in an interview with “Globes” following the announcement of the sale of the company to Spansion Inc. (Nasdaq: SPSN) that he would have been happy had he been able to have obtained a higher company value than the $368 million at which the deal was made. “I'm very sorry, and if I should apologize, then I do apologize to anyone who isn't happy. I'm not ashamed. It's not because we didn't try, not because we lost our way and got sidetracked by the money."
Some shareholders do not accept this apology. Sources inform ''Globes'' that certain Saifun Semiconductors Ltd. (Nasdaq:SFUN) shareholders are likely to oppose the sale of the company to Spansion and vote against it at the upcoming general shareholders meeting in a few weeks. Some are already taking action.
The first shareholder to express his loud and clear dissatisfaction is businessman Efi Gildor, who owns 4.8% of the company through Argos. He sent a letter to Eitan yesterday. The letter is also addressed to the company’s directors and Saifun CFO Igal Shany. “Globes” has obtained a copy of this letter.
Gildor writes that he will oppose the sale. Gilder told Eitan that he failed to meet the target he had set, and that in his opinion, “Saifun was priced at a major discount for the deal.”
Gildor is not satisfied with the 8.5% premium for the sale. “It does not reflect the potential of Saifun’s intellectual property,” he says. “Management and the board should be more focused on increasing value for shareholders, especially in view of the share’s performance since the beginning of the year. The deal is absurd, especially in view of our demand last year to distribute money to shareholders and to manage the business more efficiently. We hope that more shareholders will oppose the deal in its present format.”
Saifun said in response, “No comment.”
In February 2005, before Saifun’s IPO, Gildor saw an opportunity in the company, or so he thought, and bought shares from Infineon AG (NYSE; XETRA:IFX), Eitan, and then Saifun president Kobi Rozengarten, who is currently a company director. Gildor paid $31.3 million dollars for the shares. He believed in Eitan’s dream and vision, and did not sell shares during Saifun’s secondary offering. The investment was made at a price of $20.75 per share.
Investors will receive $10.40 per share under the Spansion deal, which means that Gildor will make $10.9 million for his holding in Saifun and, theoretically and on paper, make a loss of $20 million. These losses are undoubtedly enough of an incentive to go against the company.
Published by Globes [online], Israel business news - www.globes.co.il - on October 24, 2007
© Copyright of Globes Publisher Itonut (1983) Ltd. 2007