| Obrem Open Letter to Micrel Stockholders Info |
Obrem Open Letter to Micrel StockholdersObrem Capital Management Open Letter to our Fellow Micrel Stockholders Day trading stock pick tip... Click here - - - - - - - - - - - Micrel improperly blames the market for company-specific issues. Micrel blames semiconductor market conditions for the Company's ongoing underperformance; however, the last five years have been strong for the analog semiconductor industry, with analog industry revenue up 36% from 2003 to 2007 (source: WSTS). Micrel, in the corresponding period, has only increased revenues 22%. In addition, current sentiment and market conditions might explain why Micrel's stock is trading at the lower end of its "range" but does not explain why Micrel's shares have underperformed peers. Growth is typical in the semiconductor industry, and Micrel lags. Micrel asserts that it has increased revenue in 24 out of the last 29 years. While that is true, Micrel fails to point out that the entire semiconductor industry has increased revenue in 24 out of the last 29 years (sources: WSTS, SIA). More importantly, Micrel fails to address the fact that it has trailed industry growth rates (based on WSTS data) in 6 of the last 7 years. Micrel's operating performance lags its peer group. Obrem stands by its previous statements regarding Micrel's poor operational performance relative to peers. Obrem has compared Micrel to an appropriate high-performance analog peer group and is surprised that Micrel management has chosen to include several smaller or lower-end competitors in its analysis. Deutsche Bank, in its March 25, 2008 note, "HPA Roundup #5 2007/2008 Winners & Losers," identifies Micrel as having the lowest 3, 4, and 5 year revenue CAGRs among a group of 10 peers. In addition, Micrel's operating margins are among the lowest of appropriate high performance analog comparables. Micrel's performance issues are not new and are quite serious.
- - - - - - - - - - - We are disappointed by Micrel's personal attacks and misstatements. Micrel makes several inaccurate assertions in an attempt to disparage our Nominees. Contrary to Micrel's assertion that our Nominees "have very limited semiconductor industry and operating experience," two of our Nominees, Keith Kolerus and Bill Bradford, collectively have 60 years of semiconductor industry experience in top leadership roles, with the vast majority of that time spent at companies significantly larger than Micrel. Top of this Obrem Open Letter to Micrel Stockholders page.
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