Sept 9 (Reuters) - Mosaid Technologies’ inclusion of penalty in case of a change in ownership of the patents its recently acquired was designed to thwart a hostile C$480 million takeover bid, according to its suitor WiLan Inc .
Mosaid has rejected WiLan’s bid and instead bought a portfolio of Nokia and Microsoft patents, in a deal which includes a “change of control” penalty fee of $5 million, WiLan said in a statement.
“In the current circumstances, the change of control penalty is clearly designed to interfere with WiLan’s offer and has the effect of entrenching management at a cost to Mosaid shareholders,” WiLan said.
WiLan said it believes Ottawa-based Mosaid’s deal to buy the patents “is not attractive from a financial or business perspective.”
However, it added that the lack of public disclosure of key terms of Mosaid’s deal to buy the patents made it difficult to arrive at a definitive conclusion.
WiLan, which develops and licenses intellectual property for the communications and consumer electronics markets, made a C$38-a-share offer for Mosaid in late August. The bid underscores the global race for technology patents to use as weapons in litigation and in cross-licensing. (Reporting by Aftab Ahmed in Bangalore; Editing by Savio D‘Souza)