LONDON A controversy pitting Altera Corp. against a semiconductor industry analyst came to a head this week when the company issued an apology for refusing to speak with the analyst, who has been critical of the company.
Nathan Sarkisian, Altera's chief financial officer, issued a statement apologizing to Tad LaFountain, the Wells Fargo Securities LLC analyst, and to Altera investors. The dispute between the programmable chip company and LaFountain erupted earlier this year when he issued critical reports on Altera, which then stopped talking to him.
In the statement, Sarkisian said: “In March, I informed Mr. A.A. (Tad) LaFountain, III, semiconductor securities analyst at Wells Fargo Securities, that I, our CEO and our investor relations staff would no longer continue dialogue with him. I took this action because, in my view, we were having unproductive conversations on a topic for which we had irreconcilable differences.
"Consequently, on July 26, Mr. LaFountain chose to drop Altera coverage. Regrettably, as a result of our action and the ensuing press coverage, some have concluded that our intention was to manipulate opinion. In retrospect, our decision to disengage was in error, and I apologize to Mr. LaFountain, our investors and the investment community.”
Sarkasian said the disagreement with LaFountain focused on Altera’s share repurchase program. He said Altera (San Jose, Calif.) had never stop talking to or challenged an analyst based on the analyst's rating of the company.
“The core of our differences with Mr. LaFountain is our share repurchase program, which he asserts has destroyed shareholder value.”
Sarkisian argued that since the start of the share repurchase program Altera had returned $1.5 billion to shareholders while it had taken the company’s valuation from $1.2 billion to $8.1 billion. He added that Altera remained committed to its share repurchase program.
“Simply stated, our commitments going forward are: Wall Street analysts who cover Altera will have access to management. We will continue to strive to operate our business and investor relations program on a best-practice basis,” Sarkisian concluded.
The dispute was widely reported in newspapers, including the New York Times.