It's Obrem Capital's turn to reach out to Micrel stockholders; special meeting set for May 20

By Lisa Kerner

Charlotte, N.C., May 5 - Obrem Capital Management, LLC wants Micrel, Inc. shareholders to hold the company's board of directors accountable for the company's "decade-long underperformance" by electing Obrem's director nominees at the special meeting on May 20.

In yet another letter to Micrel stockholders, Obrem raised eight questions it believes shareholders should ask the company's board and management:

• Why doesn't Micrel provide shareholders with a simple five- or 10-year stock price chart to highlight its "so-called value-creating results?"

• Why should shareholders believe the company will continue to execute its plan given Micrel's "poor track record?"

• How committed is Micrel to thoroughly reviewing bona fide proposals?

• Who has more alignment with shareholders - another shareholder or a paid executive with a "founder's emotional attachment to the company?"

• Shouldn't Micrel's operational plan include measures to improve Micrel's outsourcing strategy, manufacturing cost structure and operating expenditures, among other things?

• Why is Micrel attempting to portray two of Obrem's nominees, Keith Kolerus and Bill Bradford, as lacking experience?

• Does Micrel believe it is a positive achievement to have one of the lowest consensus rankings among sell-side analysts in the entire analog sector?

• Why should shareholders believe Micrel's board is anything but entrenched when it "acts and talks like an entrenched board?"

Micrel, Obrem battle for support

On May 1, Micrel urged shareholders to vote against Obrem's proposals and director nominees.

Micrel said the hedge fund, which has owned Micrel stock for approximately two months, is trying to oust the company's current board and force a sale of the company, it was previously reported.

In an April 25 letter to shareholders, Micrel called Obrem's slate of nominees inexperienced. Micrel said the company has plans for growth, including doubling new analog power products in its portfolio and targeting opportunities in voice-over-internet protocol, automotive and power over Ethernet.

According to the letter, Micrel also plans to continue repurchasing shares and to increase its dividend.

Two shareholders together owning 30% of Micrel, Warren H. Muller and founder and chief executive officer Raymond D. Zinn, intend to vote against the Obrem's proposals and nominees, Micrel noted previously.

On April 26, Obrem urged Micrel shareholders to elect its director nominees:

• Bill Bradford, a co-founder and general partner of Saguaro Ventures;

• Keith R. Gollust, a founding partner of Gollust, Tierney, and Oliver, a private investment firm;

• Eric Gomberg, a senior investment analyst at Obrem Capital Management;

• Ben Goren, a principal at GCG Capital;

• Keith M. Kolerus, former chairman of the board of ACI Electronics; and

• Andrew Rechtschaffen, founder and managing member of Obrem Capital Management.

In a prior letter to Micrel shareholders, Obrem said it believes stockholders will continue to suffer if the company's board is allowed to remain in place.

Micrel's board "continues to try to deflect attention from its own poor track record by using Obrem's tenure as a stockholder as an irrelevant distraction," the letter stated.

On April 16, Micrel announced it was soliciting proxies against Obrem's proposals.

Micrel cited its directors' collective 200 years of relevant experience and said they "bring a valuable blend of deep strategic, senior executive, operational and public company board expertise inside and outside of the semiconductor industry."

Micrel develops and manufactures high-performance analog power integrated circuits (ICs), mixed-signal ICs and digital ICs. The company is based in San Jose, Calif.

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