MICROPROCESSOR firm CSR’s $679m (£415m) takeover of Zoran could be scuppered after the video chipmaker was forced to issue a warning on its revenues yesterday.
Zoran has been hit by the Japanese earthquake and the decision by customer Cisco to stop making the Flip video camera, which uses its processors.
The US-based firm now expects to report second-quarter revenues of between $80m and $85m, missing forecasts of $95m to $97m by a long distance. It said it was already seeing signs of recovery as optimism builds, but the sentiment was not enough to ease CSR’s concerns.
If it walks away from the deal, CSR will be forced to pay a break fee of $12.2m. This was not enough to put off investors, with CSR shares rising 3.7 per cent while Zoran’s stock tumbled by more than 11 per cent.
The British chipmaker may now seek to renegotiate the deal, with analysts saying it would be reluctant to abandon it altogether.
AT the centre of the possible renegotiation of CSR’s £415m deal for Zoran will be Rothschild, which is acting as financial adviser. Dominic Hollamby is heading up the team for the bank. He gained a reputation as a dealmaker in the healthcare sector, overseeing the auction of the Priory Group and Bridgepoint Capital’s sale of Alliance Medical Holdings to Dubai International Capital for £600m.
JP Morgan is also acting as financial adviser and broker, with Rupert Sadler heading up the team in the UK, working with James Robinson. UBS is joint broker, with Tim Pratelli heading up the team.