June 22, 2009 / 5:54 PM / in 9 years

UPDATE 2-Emulex holders urged to reject Broadcom proposals

* Glass Lewis recommends against Broadcom proposals

* Emulex shares down 2 pct; Broadcom down 3 pct (Adds Broadcom’s response, updates share movement)

June 22 (Reuters) - Emulex Corp ELX.N said proxy advisory firm Glass Lewis & Co has recommended against the consent solicitation begun by Broadcom Corp BRCM.O with respect to its $9.25 per share tender offer for the storage technology company.

Glass Lewis said in its report that Broadcom had submitted governance reforms merely in an effort to force an acquisition of the company and that it has little interest in the long-term corporate governance of the company, Emulex added.

Separately, Broadcom said the recommendation made by Glass Lewis misinterprets Broadcom’s consent solicitation.

“Glass Lewis’s position is particularly perplexing,” Broadcom said, adding that the firm had made an initial recommendation supporting proposals, which would give shareholders the right to call a special meeting for replacing the incumbent directors.

Emulex rejected the chipmaker’s bid in May and has urged shareholders to do the same, calling the offer “grossly inadequate.”

Shares of Emulex were down more than 2 percent at $10.76 Monday on the New York Stock Exchange, while those of Broadcom fell 3 percent to $24.66 on Nasdaq.

Emulex shares have risen 62 percent since Broadcom’s bid on April 21. (Reporting by Shrutika Verma in Bangalore; Editing by Anil D’Silva)

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