International Rectifier has rejected a move by Vishay to buy the analogue semiconductor manufacturer in a deal which would have valued the company at $1.6bn.

IR's board of directors unanimously determined that the unsolicited bid to acquire all of the outstanding shares of International Rectifier for $21.22 per share in cash was not in the best interests of the company and its shareholders.

“The board believes that the proposal by Vishay does not value the company and its future prospects appropriately. In our judgment, IR shareholders will be better served by allowing management to move forward with its strategic plan," said Richard Dahl, chairman of the board of International Rectifier.

Vishay's offer represented an approximate 13% premium over the closing price of IR's common stock of $18.82 on August 14, and a 20% premium over its 30-day moving average of $17.69.

Dahl believed that the company's valuation was still under the cloud of legacy issues which were now being addressed.

The board communicated its decision to Vishay in a letter.