UPDATE 3-ASMI rejects investor's demand for board shake-up

(Adds Fursa reaction)

By Niclas Mika

AMSTERDAM, Feb 28 (Reuters) - Dutch chip equipment maker ASM International (ASMI.AS: Quote, Profile, Research)(ASMI.O: Quote, Profile, Research) rejected plans by an activist investor to shake up the company's board on Thursday, the latest twist in a fight that has lasted more than two years.

ASMI said its management and supervisory boards were "confident that current management is able to deliver" on turnaround plans for the company's struggling front-end unit, which makes machines for the early stages of chip production.

"Therefore, we are of the opinion that it is not in the interest of the company and its stakeholders to now make changes in the management board other than already announced," it said.

Chuck del Prado will take over as chief executive in March from his father, company founder Arthur del Prado, who still holds 21.3 percent of ASMI's shares.

Years of underperformance by the front-end unit led activist investor Fursa Alternative Strategies, which holds a 10.3 percent stake in ASMI, to target the firm.

"Del Prado will go head-to-head with Fursa," Rabo Securities analysts said in a note. "Please note ASMI can issue preference shares, when wanted, to dilute Fursa's stake."

Fursa said in a statement it was disappointed by the front-end results and would keep up its push for change.