Gennum ups offer for Tundra

Shares of Tundra Semiconductor Corporation (TSX: T.TUN, Stock Forum) jumped more than 14% to $5.65 Friday, as Gennum Corporation (TSX: T.GND, Stock Forum) announced that it is increasing its purchase price for the Ottawa-based company.

Gennum, which manufactures silicon integrated circuits and hybrid circuits for manufacturers of video equipment, hearing equipment, and data communications equipment said Friday that it is increasing the purchase price for all of the Tundra shares from approximately $86 million to approximately $112 million, representing an increase of 31%.

The consideration payable by Gennum for each Tundra Share will now be $5.81 in cash or 1.1679 common shares of Gennum, or a combination. Previously, Tundra shareholders could elect to receive $4.43 in cash or 1.1575 Gennum Shares for each Tundra share.

The companies say they continue to expect the arrangement to close around June 1.

Back on April 7, in a post entitled “Fair offer?” arbtrader123987 made the following comments:

Notice that volume on TUN has all dried up. Obviously the main shareholders (70% of the shares held by LT institutional holders like Fidelity and Mackenzie) are not selling. Lets see a better take-over price. Cash + building + inventory + tax credits + AR - AP = tangible book value of $110M ($5.10 per share). Bid is for $83M so there is room to increase the bid... Keep in mind that even at $110M Gennum is paying $0 for Tundra's IP and future cash flows... not a bad deal eh?[sic]…