An investor group led by Boston-based Bain Capital last month agreed to acquire Integrated Circuit Systems (ICS), a manufacturer of integrated circuit products for multimedia and data communications applications, for approximately $269 million.
According to the agreement, the investor group-which also includes Bear, Stearns & Co. and ICS’s senior management-will pay $21.25 per share to acquire all of the outstanding stock of the company. As of the fiscal year ended last June 27, the company reported 12,343 common shares outstanding, with approximately 4.9% of these shares controlled by senior management, according to the company’s annual report. At press time, shares of ICS were trading at $18.625.
Geoffrey Rehnert, a managing director at Bain Capital, declined to comment on the deal as the transaction is still pending.
Greg McClenon, an analyst at San Francisco-based Moores & Cabot Inc. who follows ICS, said the company suffered from a poor fourth quarter last year but was poised for strong growth in the future. “They’re just beyond a crossroads now,” Mr. McClenon said. “They’re looking at about 15% or 20% growth over the next couple of years.”
Should the deal meet with shareholder approval-which will be sought at the shareholder meeting scheduled for Feb. 1 as BUYOUTS goes to press-the acquisition is anticipated to close at the end of this month.
Former ICS Chief Executive Officer Stavro Prodromou-who resigned his post early last year-has filed a challenge against the acquisition charging that the company’s board of directors, should they approve the deal, would not be acting in the shareholders’ best interest. In his challenge, Mr. Prodromou reportedly cites a management-led buyout offer of $17.50 per share for ICS that took place last year; a special committee of the board of directors voted against that offer, claiming that the agreement would have been unfair to ICS shareholders.
ICS subsequently denied the validity of Mr. Prodromou’s challenge and reiterated its belief that the buyout would best serve its shareholders, according to a statement from the company. Directors at ICS could not be reached for comment.
ICS manufactures integrated circuit components predominately for the motherboards of personal computers. Headquartered in Valley Forge, Pa., and with a manufacturing facility in San Jose, Calif., ICS reported revenue of more than $160 million for the fiscal year ended June 27.