OTTAWA - Zarlink Semiconductor Inc. (TSX:ZL), which is in a fight with a group of dissident shareholders, said Tuesday that its shares will be suspended from trading on the New York Stock Exchange next week.

The company said the U.S. exchange made the decision after Zarlink fell below the NYSE's continued listing standard for average share price over a consecutive 30 trading-day period of not less than US$1. The stock will continue to trade on the Toronto Stock Exchange, which accounts for more than 75 per cent of the company's total daily trading volume.

Application to the U.S. Securities and Exchange Commission to delist the issue from the NYSE is pending the completion of applicable procedures, the company said.

"The technology advances in equities trading mitigates the requirement for Zarlink to continue to be listed on multiple exchanges," Zarlink president and CEO Kirk Mandy said in statement.

"This decision will not impact the financial status of Zarlink or affect the way it conducts its business."

A group of dissident shareholders is trying to replace five of Zarlink's eight directors at the company's annual meeting on Wednesday.

The dissidents, including Scott Leckie, who manages funds owning a 5.2 per cent stake in the company, want to remove Mandy, chairman Henry Simon, Jules Meunier, Dennis Roberson and Oleg Khaykin from the board.

They have complained about the performance of Zarlink shares which once traded as high as $48.25 in March 2000, but have remained below $4 since October 2004.

In an attempt to settle the dispute ahead of the meeting, the company said Tuesday it met with the Leckie group which asked for three seats on the board and $600,000 in reimbursement of proxy costs.

Zarlink said it offered to add two new independent directors to the current board, but was rejected.

The dissident shareholders said Tuesday that its nominees have received the support of about 40 per cent of all votes to be cast for Zarlink's annual meeting.

"There is clearly a strong and widespread desire for change to create a board that will hold Zarlink's management accountable for its failures to enhance shareholder value," Leckie said in a statement.

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