RPT-UPDATE 1-DEALTALK-Quattrone strikes again with Nat Semi deal

(Repeats story originally published late on Monday)
(For more Reuters DEALTALKS, click [DEALTALK/])

* NatSemi latest in string of tech mandates for Quattrone

* Bankers envy his track record but criticize sale process
(Adds advisors on NatSemi/Texas Instruments deal)

By Nadia Damouni

NEW YORK, April 4 (Reuters) – In the fiercely competitive
world of technology deal advising, Frank Quattrone’s boutique
investment bank appears to be crushing Wall Street’s biggest
firms — and they don’t like it at all.

Quattrone’s Qatalyst Partners and his seasoned team of
veteran bankers have won advisory mandates for some of the most
high-profile tech mergers and acquisitions in the past year,
including Palm, 3PAR, Isilon, Netezza and Atheros.

On Monday, he catapulted back into the limelight by
advising National Semiconductor Corp (NSM.N: Quote, Profile, Research) on its $6.5
billion sale to Texas Instruments Inc (TXN.N: Quote, Profile, Research). [ID:nN04281619]

With often eye-popping deal premiums like the 78 percent
premium that TI agreed to pay for NatSemi, it’s no surprise
that Quattrone often garners praise for aggressive dealmaking.
But some rival bankers, and Silicon Valley executives, are more
critical about the way Qatalyst runs a sale process.

Quattrone has been involved in two bidding wars on the sell
side: Data Domain, which was sold to EMC Corp (EMC.N: Quote, Profile, Research), and
3PAR, which was sold to Hewlett-Packard Co (HPQ.N: Quote, Profile, Research). That raised
eyebrows as bidding wars are very rare in tech, and critics say
they were the result of inadequate market checks by Quattrone.

Qatalyst had advised 3PAR to accept Dell’s first offer of
$18 a share based on “a fairness opinion,” which fell far short
of the final $33 per share price, or $2.4 billion, that HP
ended up paying. The final price was more than triple 3PAR’s
market value before the bidding war.

“They (Qatalyst) signed up a deal at a value below the
market clearing price. The sole job of a sell-side adviser is
price discovery and they failed in that job,” said one tech
banker who spoke on condition of anonymity.

Qatalyst declined to comment.

Other tech bankers — some of whom have lost mandates to
Quattrone or represented the buy-side — criticized the media
leaks that often accompanied his deals, which helped drive up
sale prices.

“If you put yourself in the shoes of one of these heads of
M&A, a board member or a CEO, it is almost embarrassing if you
have been working on a transaction that gets leaked, and then
the stock runs and you have to put a premium on top of it, and
then you look like Tom Foolish,” said another tech banker.


Quattrone is as successful as he is controversial. A star
investment banker in the 1990s, he had worked at Morgan Stanley
(MS.N: Quote, Profile, Research), Deutsche Bank (DBKGn.DE: Quote, Profile, Research) and Credit Suisse (CSGN.VX: Quote, Profile, Research),
and helped arrange some of the biggest tech initial public
offerings of the era, including Amazon.com Inc (AMZN.O: Quote, Profile, Research) and
Cisco Systems Inc (CSCO.O: Quote, Profile, Research).

His time at the top of Silicon Valley was curtailed by
charges that he blocked an investigation into IPO kickbacks.
After two trials failed to resolve his case, he ultimately
reached a deal with prosecutors. [ID:nN27272921]

Quattrone returned to investment banking in 2008 when he
founded Qatalyst in San Francisco. Last year, he hired friend
George Boutros, a Credit Suisse veteran who advised on Sun
Microsystems’s sale to Oracle Corp (ORCL.O: Quote, Profile, Research) and Google’s
purchase of YouTube.

Qatalyst is one of several boutique investment banks, such
as Evercore Partners (EVR.N: Quote, Profile, Research), Greenhill & Co (GHL.N: Quote, Profile, Research) and
Perella Weinberg Partners, that have gained in M&A advisory
rankings previously the domain of Goldman Sachs (GS.N: Quote, Profile, Research), Morgan
Stanley, JPMorgan Chase (JPM.N: Quote, Profile, Research) and Bank of America Merrill
Lynch (BAC.N: Quote, Profile, Research). [ID:nN23283087]

NatSemi is the second multibillion-dollar tech deal for
Qatalyst this year. It advised Atheros Communications Inc, a
producer of chips for tablet computers and smartphones that was
sold to Qualcomm Inc (QCOM.O: Quote, Profile, Research) for $3.2 billion in January.

“As much as someone in my seat would freakin’ hate this
guy, he is really good at what he does,” said the second

Quattrone, famous for his bushy mustache, garish sweaters
and love of jazz and karaoke, has a track record of advising
one company in a sector and then moving on to its peers. 3PAR,
Data Domain and Isilon are all in data storage, while NatSemi
and Atheros are both chipmakers.

Still, he’s lost his share of deals. Qatalyst felt the
pinch when it was unable to secure a buyer for Web-hosting
company Go Daddy, which called off its auction last October.

And in 2009, Qatalyst had advised data center company
Brocade Communications (BRCD.O: Quote, Profile, Research) on a potential sale to HP but
talks fell apart over price and HP bought 3Com instead,
according to sources familiar with the matter.

Qatalyst and Goldman Sachs advised NatSemi on its deal,
while Morgan Stanley advised Texas Instruments.
(Reporting by Nadia Damouni, editing by Tiffany Wu, Gary Hill)

RPT-UPDATE 1-DEALTALK-Quattrone strikes again with Nat Semi deal