I last wrote about California Micro Devices in this blog on August 30. As I noted then, CMD has an annual meeting scheduled for September 17 (this Thursday) and it faces a challenge from Dialectic Capital Management.
The back-and-forth of charge and counter-charge has intensified in the days leading up to the vote, which will determine who is to occupy three of the seats on CMD's seven-seat board of directors.
Last week, CMD alleged that DCM had reneged on a settlement agreement. The company said that the two sides had struck a deal according to which Dialectic would halt its opposition to the re-election of the full board, and that in return for this, after that re-election, CMD would expand the size of its board to none, adding two of the Dialectic nominees.
But, Chairman Wade Meyercord wrote: "To my great surprise and disappointment ... while our lawyers and theirs were finalizing a written settlement agreement, Dialectic reneged on the agreement."
Dialectic has responded that there was no settlement, that CMD has refused to engage in serious negotiations, and that this charge is "clearly a last ditch effort by a desperate Board to maintain its fleeting grasp upon the privileges the directors have so lavishly bestowed upon themselves."
Whoa, dude. Lots of adjectives there.
Showing posts with label California Micro Devices. Show all posts
Showing posts with label California Micro Devices. Show all posts
Monday, September 14, 2009
Sunday, August 30, 2009
California Micro Devices (CMD)
CMD, a company headquartered in Milpitas, Calif., supplies semiconductors that are used in mobile handsets, LEDs, and personal comupters. Its manufacturing facilities are in China, Japan, and Korea.
It holds its annual meeting September 17, and the activist investment fund that threatens to play the role of skunk at that picnic has the oddly Hegelian name Dialectic Capital Management, which holds 8.8% of the company's stock.
The dispute concerns the Arques Technology deal. Back in April 2006, CMD acquired Arques, a move it proudly referred to at the time as "an important milestone in the evolution" of CMD. It thereby added DDR memory voltage regulators to its product portfolio. But by December 2008, management had become sufficiently disenchanted that it wrote off all the goodwill associated with that acquisition.
So ... what the heckis a DDR memory voltage regulator? As a techie doofus, I'll look it up. DDR stands for "Double data rate." It was a class of integrated circuit that began to be included in computers in the mid 1990s. Since then there has been DDR2 and DDR3. So it is possible that in buying Arques, CMD thought it was buying something more cutting-edge than was in fact the case, which would explain the disenchantment.
At any rate, the dissidents contend that such "debacles" are part of a recurring theme, "management has repeatedly embarked on risky projects in an indecisive manner, failing to deliver tangible results for stockholders. Meanwhile, the Board has clearly failed to hold management accountable."
It holds its annual meeting September 17, and the activist investment fund that threatens to play the role of skunk at that picnic has the oddly Hegelian name Dialectic Capital Management, which holds 8.8% of the company's stock.
The dispute concerns the Arques Technology deal. Back in April 2006, CMD acquired Arques, a move it proudly referred to at the time as "an important milestone in the evolution" of CMD. It thereby added DDR memory voltage regulators to its product portfolio. But by December 2008, management had become sufficiently disenchanted that it wrote off all the goodwill associated with that acquisition.
So ... what the heckis a DDR memory voltage regulator? As a techie doofus, I'll look it up. DDR stands for "Double data rate." It was a class of integrated circuit that began to be included in computers in the mid 1990s. Since then there has been DDR2 and DDR3. So it is possible that in buying Arques, CMD thought it was buying something more cutting-edge than was in fact the case, which would explain the disenchantment.
At any rate, the dissidents contend that such "debacles" are part of a recurring theme, "management has repeatedly embarked on risky projects in an indecisive manner, failing to deliver tangible results for stockholders. Meanwhile, the Board has clearly failed to hold management accountable."
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