Finance

Marvell Technology to buy smaller rival Cavium

Marvell Technology to buy smaller rival Cavium

("Cavium" or the "Company") (NASDAQ GS: CAVM) regarding possible breaches of fiduciary duties and other violations of law related to the Company's entry into an agreement to be acquired by Marvell Technology Group Ltd. ("Marvell") (NASDAQ GS: MRVL) in a transaction valued at approximately $6 billion.

Chief Executive Matthew Murphy, who took the top job a year ago, has been focusing on Marvell's networking business to counteract declining demand for its chips used in hard disk drives of personal computers.

Shares of Marvell were down 0.8 percent to $20.14, while Cavium was up 7 percent at $81.14 in early trading.

With the buyout of its rival, the chipmaker will be able to diversify away from its traditional storage devices business following an agreement with Starboard Value previous year to accept three new directors nominated by the activist hedge fund to its board. Nationally recognized Johnson Fistel is investigating whether the proposed deal represents adequate consideration, especially given the Company's outlook for future revenue and earnings growth, and one Wall Street analyst has a $90.00 price target on the stock.

The acquisition will expands Marvell's portfolio and combine it with Cavium's portfolio.

Woman Accuses Al Franken of Groping Her While Posing For Photo
Jeremy says he and his wife were "upset" and "in shock" while Franken quickly left the booth after the photo was taken. Her husband confirmed her recollection: "He reached around her and kind of pulled her into him", Jeremy Menz said.

Hamilton, Bermuda-based Marvell makes chips for storage devices while San Jose, California-based Cavium builds network equipment.

Cavium has been trying to break into the server microprocessor market using ARM technology.

Last week, Qualcomm rejected an unsolicited, $103 billion buyout from Broadcom, saying the bid was too low.

Under the agreement, Marvell will offer $40.00 per share and 2.1757 of its shares for Cavium's shares.

Goldman Sachs was the financial adviser to Marvell while Qatalyst Partners and JP Morgan Securities were the financial advisers to Cavium.


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