SAN DIEGO and IRVINE, Calif., May 28,
2015 /PRNewswire/ -- Shareholder rights attorneys at Robbins
Arroyo LLP are investigating the proposed acquisition of Broadcom
Corporation (NASDAQ: BRCM) by Avago Technologies Limited (NASDAQ:
AVGO). On May 28, 2015, the two
companies announced the signing of a definitive merger agreement
pursuant to which Avago will acquire Broadcom. Under the
terms of the agreement, Broadcom shareholders will receive
$54.50 in cash, 0.4378 shares of the
newly-formed company, or a combination thereof, for each share of
Broadcom common stock they own.
View this information on the law firm's Shareholder Rights Blog:
www.robbinsarroyo.com/shareholders-rights-blog/broadcom-corp
Is the Proposed Acquisition Best for Broadcom and Its
Shareholders?
Robbins Arroyo LLP's investigation focuses on whether the board
of directors at Broadcom is undertaking a fair process to obtain
maximum value and adequately compensate its shareholders.
As an initial matter, the $54.50
merger consideration represents a discount of -4.6% based on
Broadcom's closing price on May 27,
2015. This discount is significantly below the average
one-day premium of nearly 38% for comparable transactions within
the past five years. Further, the $54.50 merger consideration is below the target
prices set by eleven analysts ranging from $60.00, set by B. Riley & Co. on April 22, 2015, and $55.00 set by FBR Capital Markets on April 22, 2015. Recently, Broadcom traded as high
as $57.69 on May 27, 2015.
On April 21, 2015, Broadcom
reported strong quarterly earnings results for its first quarter
2015. Net revenue for the first quarter of 2015 was $2.06 billion, an increase of 3.7% from the first
quarter of 2014. GAAP net income for the quarter was $209 million, an increase of 27% from the first
quarter of 2014. Additionally, Broadcom beat consensus analyst
estimates for sales in three out of the past four quarters. In
commenting on these results, Broadcom President and Chief Executive
Officer Scott McGregor remarked,
"Broadcom delivered better-than-expected results in the March
quarter driven by strength in the high-end smartphone and broadband
access markets. Looking to the June quarter, we see operating
performance continuing to strengthen on tight operating expense
discipline and strong margins, consistent with our objective of
driving profitable growth."
In light of these facts, Robbins Arroyo LLP is examining
Broadcom board of directors' decision to sell the company now
rather than allow shareholders to continue to participate in the
company's continued success and future growth prospects.
Broadcom shareholders have the option to file a class action
lawsuit to ensure the board of directors obtains the best possible
price for shareholders and the disclosure of material information.
Broadcom shareholders interested in information about their rights
and potential remedies can contact attorney Darnell R. Donahue at (800) 350-6003,
ddonahue@robbinsarroyo.com, or via the shareholder information form
on the firm's website.
Robbins Arroyo LLP is a nationally recognized leader in
securities litigation and shareholder rights law. The law
firm represents individual and institutional investors in
shareholder derivative and securities class action lawsuits, and
has helped its clients realize more than $1
billion of value for themselves and the companies in which
they have invested.
Attorney Advertising. Past results do not guarantee a
similar outcome.
Contact:
Darnell R. Donahue
Robbins Arroyo LLP
600 B Street, Suite 1900
San Diego, CA 92101
ddonahue@robbinsarroyo.com
(619) 525-3990 or Toll Free (800) 350-6003
www.robbinsarroyo.com
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SOURCE Robbins Arroyo LLP