PLX Technology Inc. (PLXT) fell the most since October after the Federal Trade Commission filed an administrative complaint seeking to block its $330 million acquisition by electronics components maker Integrated Device Technology Inc. (IDTI)
The stock tumbled 17 percent to $3.72 at 1:40 p.m. in New York trading, the steepest decline since Oct. 18. The Sunnyvale, California-based company has fallen 29 percent this year.
The deal would give the combined firm a near-monopoly on the PCle switch, a type of integrated circuit crucial to connectivity in computers and other electronic devices, the FTC said yesterday in a statement.
“The combination of IDT and PLX would hurt competition and lead to higher switch prices, lower innovation in the marketplace, and reduced customer service,” Richard Feinstein, director of the FTC’s Bureau of Competition, said in the statement.
IDT’s proposed acquisition of PLX would give the combined firm a share of more than 85 percent of the almost $100 million market for PCle switches, the commission said.
Customers have pitted one company against the other to get lower prices and the proposed transaction would end this beneficial rivalry, the FTC said in its complaint.
Graham Robertson, a spokesman for San Jose, California- based IDT, declined to comment on the FTC complaint. David Hurd, a spokesman for PLX, didn’t respond yesterday to voice-mail and e-mail messages seeking comment on the complaint.
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