SANTA ANA, Calif. (CN) – Facing several shareholder class actions, Emulex has fought back and sued Broadcom, claiming it is trying “to acquire Emulex at a bargain basement price by deceiving Emulex shareholders into believing Broadcom is offering a generous price.”
In its federal complaint, Emulex claims Broadcom violated securities laws after Emulex “has beaten Broadcom to the market with superior technology” in network interface for large server applications. Emulex claims Broadcom “disparaged and misrepresented Emulex’s success in order to foster an ill-founded belief that Emulex shareholders will be well advised to support Broadcom’s woefully inadequate offer.
A Broadcom spokesman responded by calling the Emulex suit “a stalling tactic designed to prevent Emulex shareholders from being heard on the merits of our offer.” Spokesman Bob Marsocci said Emulex should let its shareholders choose between Broadcom’s “highly certain, all cash, high premium” or the current managemen of Emulex with “a track record of missed earnings and lost market share.”
Shareholders have filed a series of class actions against Emulex in late April and repeatedly this month, claiming that Emulex Corp. directors adopted an unfair poison pill, limited shareholders’ power and wrote themselves golden parachutes upon getting a good buyout offer from Broadcom of $9.25 per share. Five class actions were filed in Delaware Chancery Court, a sixth in Orange County Court, Calif.
Emulex is represented in this action by Wayne Smith with Gibson, Dunn & Crutcher of Irvine.