Wi-LAN Inc. has boosted its hostile takeover bid for rival patent house Mosaid Technologies Inc. by 11 per cent to $42 per share, raising its the total offer to $500.6 million from a previous $480 million.
The offer of $42 per share represents a premium of 38.6 per cent to the value of Mosaid shares before Wi-LAN’s first overture in August and won’t be revised or extended further, the company said Wednesday.
Wi-LAN’s original offer was worth $480-million or $38 per share.
“We continue to believe that combining our two Ottawa-based firms is a unique and exciting opportunity to create a global intellectual property licensing powerhouse that combines the talent of two great teams,” said Wi-LAN chief executive officer Jim Skippen.
“It has been more than two months since Wi-LAN announced its intention to acquire Mosaid. We believe it to be a compelling and full offer, particularly in light of current market conditions,” Mr. Skippen said, adding that Wi-LAN would retain most of Mosaid’s current staff should the deal go through.
The company has repeatedly rebuffed Wi-LAN’s offers so far, as it works to find a richer alternative. It has said that an unidentified private equity firm is considering a takeover offer of its own that could be “meaningfully superior” to the earlier Wi-LAN bid.
Companies like Mosaid and Wi-LAN generate revenue by licensing technology rights to large telecom and computer chip makers, which have recently demonstrated a willingness to pay millions or even billions of dollars for patents.
Wi-LAN recently extended its takeover offer until Nov. 1.
The bid is set to expire the same day a Mosaid shareholder rights plan is set to end under a ruling by the Ontario Securities Commission.
A shareholder rights plan usually makes it prohibitively more expensive for an unwanted bidder to succeed in a hostile takeover because it floods the market with new shares or imposes other conditions.