Microsemi Buys 23% Stake in Electronics Company

Microsemi, a Santa Ana-based semiconductor products manufacturer, has bought 23% of Diodes, a Chatsworth electronic components company, for $1.6 million in cash.

At the company’s annual meeting Oct. 30, Diodes shareholders approved the sale of 1.8 million shares of newly issued common stock at $2 per share in a privately negotiated transaction with a group of 22 investors, including 11 officers and key employees of the company.

Microsemi said it bought 800,000 shares of Diodes stock as part of the private placement.

In a prepared statement released Tuesday, Diodes said the legality of the private placement has been challenged by Rectron Ltd., a Taiwanese competitor that owns 50,000 shares of Diodes common stock and an unspecified number of Diodes bonds.

Diodes said it believes the Rectron challenge is “without merit.”

Officials of Microsemi and Diodes could not be reached for additional comment about the stock purchase or the Rectron challenge.

Diodes stock closed unchanged Tuesday at $2.375 per share in trading on the American Stock Exchange. Microsemi’s stock fell 25 cents to $6.75 per share in the over-the-counter market.

David M. Lloyd, Diodes’ chairman and chief executive, said the stock sale provided an “injection of an additional $2.5 million cash” that will be used to help the company expand into the Far East.

Microsemi has bought pieces of several related companies this year. In September, Microsemi bought 60% of Vitarel Microelectronics, a San Diego maker of computer chips and integrated circuits, for about $3 million.

Also in September, the Santa Ana firm bought Salem Scientific, based in Salem, Mass., for an undisclosed sum. A month earlier, Microsemi acquired Omni Technology of Fremont. In June, Microsemi acquired the San Diego-based rectifier assembly operations of Solitron Devices for an undisclosed sum.