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Advisory firm backs Emulex board in Broadcom bid

Tue, 06/23/2009 - 8:20am
The Associated Press

NEW YORK (AP) – The proxy advisory firm Glass Lewis & Co. has come down against a proposal by Broadcom Corp. that would allow a special meeting of Emulex Corp. shareholders to discuss Broadcom's takeover offer.

Broadcom is offering $9.25 per share for the company, but less than 3 percent of shares were tendered by the bid's original deadline on June 17.

The company extended its tender offer to July 1 and sought support for an amendment that would allow stockholders representing 10 percent of outstanding shares to call a special meeting. Emulex rejects the proposal, accusing Broadcom of attempting to oust its board. Both companies provide networking equipment.

"In our opinion, Broadcom has little interest in the long-term corporate governance of the company," the Glass Lewis report says. "In this regard, we find no reason to believe that Emulex's board has not acted in the best interest of the shareholders."

Broadcom rejected the report. In a statement Monday, the Irvine, Calif.-based company accused Glass Lewis of reversing itself and misrepresenting Broadcom's intentions.

"Glass Lewis' highly unusual and sudden reversal of this position stands on its head accepted principles of good corporate governance," Broadcom said.

Robert McCormick, chief policy officer for Glass Lewis, said a version of the report supporting Broadcom was released by mistake because of an internal miscommunication. McCormick said a corrected version was released within hours.

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