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Friday, October 28, 2011

Break fee makes higher Mosaid bid unlikely, (TSE: WIN.TO)

A bid for Mosaid Technologies that tops a C$590 million ($590 million) offer from a U.S. private equity firm is unlikely, considering the cost of breaking the friendly deal and the blessing it has from two crucial Mosaid partners.The C$46-a-share offer from Sterling Partners, announced late Thursday, calls for a C$22 million penalty should Mosaid withdraw. Any rival bid would have to cover that fee, making the cost prohibitive."Anything in excess of C$50 may not make economic sense for another bidder and below C$50 makes no sense" for Mosaid, said Sameet Kanade, an analyst at Northern Securities.Mosaid shares rose 5.8 percent on Friday to C$45.92 per share. That's in line with the Sterling bid - which topped a hostile, C$42-a-share offer from Wi-Lan Inc - suggesting shareholders do not expect a higher offer.

Wi-LAN Inc. (WiLAN) develops, acquires, and licenses a range of intellectual property that drives products in communications and consumer electronics markets. Shares of WIN traded higher by 2.39% or $0.16/share to $6.86. In the past year, the shares have traded as low as $4.00 and as high as $9.56. On average, 1065840 shares of WIN.TO exchange hands on a given day and today's volume is recorded at 1248714.