An investor in TWLL filed a lawsuit on behalf of current investors in Techwell, Inc. (NASDAQ:TWLL) in California State Court alleging breaches of fiduciary duty by the board of directors of Techwell, Inc for selling itself through an unfair process.
According to the complaint the plaintiff alleges breaches of fiduciary duty by the Board of Directors of Techwell arising out of their attempt to sell Techwell, Inc. to Intersil Corporation. Techwell, Inc., located in San Jose, California, is a fabless semiconductor company that designs, markets and sells mixed-signal integrated two primary markets, security surveillance and automotive infotainment. On March 22, 2010, Techwell, Inc. (NASDAQ: TWLL) and Intersil Corporation (NASDAQ: ISIL) announced that they have entered into a definitive agreement for Intersil Corp. to acquire Techwell Inc through a cash tender offer at $18.50 per share or a transaction value of approximately $370 million. Techwell’s directors, entities affiliated with Technology Crossover Ventures, and certain executive officers of Techwell in total represent approximately 23% of the outstanding shares and according to Techwell, Inc. the agreement was unanimously approved by Techwell’s board of directors.

The plaintiff alleges that the defendants peruse “a sale of the company at an unfair price through an unfair and self-serving process”. The directors of Techwell, Inc failed to maximize shareholder, the offer does not reflect the true inherent value of the company, and the defendants ensured that “Techwell would be sold to one buyer and one buyer only by negotiating a no-solicitation clause” preventing Techwell from soliciting higher offers, “a Top-Up Option, voting agreements, and a $17million termination fee”, so the lawsuit.