Today's trading in Atmel (NASDAQ:ATML) appears to be a case of impatient and distracted investment managers in a soft market abandoning a perfectly logical expected buyout scenario. Merger and arbitrage investors pushed up Atmel to a high of $10.50 on June 22 and have since abandoned their support for the stock, allowing an unusual opportunity for investors. The stock has dropped a quarter of its value since that date.

Atmel makes small processors called microcontrollers, which are used in a long list of devices. They use only two architectures (ARM and AVR), which makes Atmel less research and development cost intensive than most companies in this space. They are also an older company in the world of semiconductors, and therefore have outdated and inefficient fabrication plants that an acquirer with more modern manufacturing capacities could easily use to improve operations. These are some reasons why in 2008 Microchip Technology (NASDAQ:MCHP) and ON Semiconductor (NASDAQ:ON) found Atmel to be an attractive acquisition target and attempted to acquire them in a failed hostile takeover attempt.

But that was during the financial crisis when most company managements resisted being acquired at discount prices. Now it's 2015 and Atmel's stock is up 60% above that 2009 offer of $5, as the semiconductor space is seeing an unprecedented record breaking year with mergers and acquisitions. Avago Technologies (NASDAQ:AVGO) acquired Broadcom (NASDAQ:BRCM) in a deal worth 67 billion. Intel (NASDAQ:INTL) bought Altera (NASDAQ:ALTR). Texas Instruments (NYSE:TI) and NXP Semiconductors (NASDAQ:NXPI) had to fight each other for the opportunity to acquire Freescale Semiconductor (NYSE:FSL). Freescale accepted one third of NXP's shares and the companies boasted 500 million…