- Combination Creates Global Leader in
Wired and Wireless Connectivity Solutions
- Expands Addressable Opportunities in
Consumer, Industrial and Communications Markets
- Identified Synergies of $32 Million;
Expected to be Immediately Accretive to EPS on Non-GAAP
Basis
Lattice Semiconductor Corporation (NASDAQ: LSCC), a leading
provider of programmable connectivity solutions, and Silicon Image,
Inc. (NASDAQ: SIMG), a leading provider of wired and wireless
connectivity solutions, today announced that they have signed a
definitive agreement, pursuant to which Lattice will acquire
Silicon Image in an all-cash tender offer of $7.30 per share,
representing an equity value of approximately $600 million (or
approximately $450 million on an enterprise value basis) and a
34.6% premium to the average closing price over the last 90 trading
days and a 23.7% premium to the closing price on January 26th.
Key Benefits of the Transaction
- Increased Strategic Relevance for
Customers
- Allows combined entity to drive early
collaboration during product design and ultimately deliver
optimized ASSP solutions, resulting in deeper, more meaningful
relationships with customers
- Revenue Expansion Opportunities
- Increased market presence and combined
product offering will result in greater lifetime revenue
opportunities
- Strong Combined IP Portfolio
- Proprietary low-power, small form
factor and low-cost FPGA technology enables programmable
connectivity in a broad range of markets
- Leading provider of IP with proven
implementations for worldwide standards
- Creates Economies of Scale With
Meaningful Synergies
- Expected to be immediately accretive on
a non-GAAP basis through efficiencies in operating expenses and
supply chain
- At least $32 million in annual
synergies which are expected to be realized within one year after
the closing of the transaction
Darin G. Billerbeck, Lattice Semiconductor’s President and Chief
Executive Officer, said, “This is a truly transformative event for
both Lattice Semiconductor and Silicon Image. For the first time in
the semiconductor industry, a single company will combine the
design flexibility and time to market benefits of FPGAs, with the
highly integrated, function and cost optimization benefits of ASSP
solutions. We are excited to move forward with Silicon Image and
confident we will be able to drive higher revenue and earnings
growth, through the benefits of better economies of scale and
material cost synergies. We expect this transaction to be
immediately accretive on a non-GAAP basis.”
Camillo Martino, Chief Executive Officer of Silicon Image,
commented, “We are excited to move forward with this unique
business combination. Lattice’s management team has a strong track
record of execution and operational excellence, both critical to
the continued expansion of our product portfolio and ability to
support our customer’s evolving requirements. Importantly, Lattice
shares our commitment to building upon Silicon Image’s rich history
of standards creation and the development of new wired and wireless
connectivity innovations. This transaction is the culmination of a
strategic process conducted under the direction of our board of
directors, and represents a significant creation of value for our
shareholders.”
Mr. Billerbeck concluded, “Lattice created the market for
programmable connectivity solutions in the consumer market,
capitalizing on our strong foothold in the communications and
industrial markets. Silicon Image has successfully established
numerous global technology standards, and built a highly valued
intellectual property portfolio in wired connectivity, millimeter
wave wireless technology and software services solutions. Our
respective technical capabilities, product portfolios and visions
for the future are complementary and will be even more powerful
when combined. Lattice is fully committed to building upon the
foundation established by Silicon Image in helping establish
industry standards, investing in new technologies and driving them
to market, which in turn should provide us with greater access to
our customers’ roadmaps and unique insight into their product
development.”
Additional Transaction Details
The transaction has been unanimously approved by the boards of
directors of both companies and is expected to close by the end of
March 2015. Pursuant to the definitive agreement, a subsidiary of
Lattice Semiconductor will commence a tender offer for 100% of the
outstanding shares of Silicon Image common stock for $7.30 per
share in cash. The tender offer is required to be commenced within
10 business days and to remain open for at least 20 business days
after launch. Following successful completion of the tender offer,
any shares not acquired in the tender offer will be acquired in a
second-step merger at the same per share cash price. The directors
and executive officers of Silicon Image have agreed to tender their
shares in the tender offer. Closing of the tender offer is subject
to customary closing conditions, including the expiration or
termination of the applicable waiting period under the
Hart-Scott-Rodino Antitrust Improvements Act and there being
validly tendered and not withdrawn a number of shares of Silicon
Image common stock equal to at least a majority of the total
outstanding shares of Silicon Image common stock. The transaction
will be funded through a combination of cash on hand and new debt
financing. The Company has received a financing commitment of $350
million from Jefferies Finance LLC. The proposed transaction is not
subject to a financing condition.
Jefferies LLC is serving as the financial adviser to Lattice
Semiconductor and Skadden, Arps, Slate, Meagher & Flom LLP is
serving as legal adviser. Barclays PLC is serving as the financial
adviser to Silicon Image and Fenwick & West LLP is serving as
legal adviser.
Acquisition Conference Call / Webcast Details
Lattice Semiconductor will hold a conference call to discuss the
proposed acquisition of Silicon Image on Tuesday, January 27, 2015
at 8:00 a.m. Eastern Time. The conference call-in number is
1-888-286-6281 or 1-706-643-3761 with conference identification
number 73009766. A live webcast of the conference call will also be
available on Lattice's website at www.latticesemi.com.
Presentation materials will be available prior to the conference
call on the investor relations section of Lattice Semiconductor’s
website at www.lscc.com.
A replay of the call will be available approximately two hours
after the conclusion of the live call through 11:59 p.m. Eastern
Time on February 9, 2015, by telephone at 1-404-537-3406. To access
the replay, use conference identification number 73009766. A
webcast replay will also be available on Lattice's investor
relations website at www.latticesemi.com.
About Lattice Semiconductor
Lattice Semiconductor (NASDAQ: LSCC) is the leader in low power,
small form factor, low cost, customizable solutions for a quickly
changing connected world. From making smart consumer devices
smarter, to enabling intelligent industrial automation, or
connecting anything to everything in communications, electronics
manufacturers around the world use Lattice's solutions for fast
time to market, product innovation, and competitive
differentiation. For more information, visit www.latticesemi.com.
You can also follow us via LinkedIn, Twitter, Facebook or RSS.
About Silicon Image
Silicon Image (SIMG) is a leading provider of multimedia
connectivity solutions and services for mobile, consumer
electronics and PC markets. Silicon Image’s semiconductor and
intellectual property products feature wireless and wired
technologies that deliver connectivity across a wide array of
devices in the home, office and on the go. Silicon Image has driven
the creation of the industry standards HDMI®, DVI™, MHL® and
WirelessHD®, and offers manufacturers comprehensive standards
interoperability and compliance testing services via its
wholly-owned subsidiary, Simplay Labs. For more information, visit
http://www.siliconimage.com/.
This communication does not constitute an offer to buy or a
solicitation of an offer to sell any securities. No tender offer
for the shares of Silicon Image, Inc. has commenced at this time.
In connection with the proposed transaction, Lattice Semiconductor
may file tender offer documents with the U.S. Securities and
Exchange Commission (“SEC”). Any definitive tender offer documents
will be mailed to shareholders of Silicon Image. INVESTORS AND
SECURITY HOLDERS OF SILICON IMAGE ARE URGED TO READ THESE AND OTHER
DOCUMENTS FILED WITH THE SEC CAREFULLY IN THEIR ENTIRETY WHEN THEY
BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION
ABOUT THE PROPOSED TRANSACTION. Investors and security holders
will be able to obtain free copies of these documents (if and when
available) and other documents filed with the SEC by Lattice
Semiconductor through the Web site maintained by the SEC at
http://www.sec.gov or through Secretary, Lattice Semiconductor
Corporation, 5555 NE Moore Court, Hillsboro, Oregon 97124-6421.
Forward-Looking Statements Notice:
The foregoing paragraphs contain forward-looking statements that
involve estimates, assumptions, risks and uncertainties. Any
statements about expectations, beliefs, plans, objectives,
assumptions or future events or performance are not historical
facts and may be forward-looking. Words or phrases such as
“anticipates,” “believes,” “could,” “estimates,” “expects,”
“intends,” “plans,” “predicts,” “projects,” “may,” “will,”
“should,” “continue,” “ongoing,” “future,” “potential” and similar
words or phrases identify forward-looking statements. The
forward-looking statements in this document address a variety of
subjects including, for example, the expected date of closing of
the acquisition and the potential benefits of the merger.
Forward-looking statements involve estimates, assumptions, risks
and uncertainties that could cause actual results to differ
materially from those expressed in the forward-looking statements.
The following factors, among others, could cause actual results to
differ materially from the forward-looking statements: the risk
that the transaction will not close when expected or at all; the
risk that the operations of the two companies will not be
integrated successfully; the failure to achieve the anticipated
benefits and synergies of the transaction; the risk that Lattice or
Silicon Image’s business will be adversely impacted during the
pendency of the transaction; costs associated with the transaction;
matters arising in connection with the parties’ efforts to comply
with and satisfy applicable regulatory approvals and closing
conditions relating to the transaction; and other events that could
adversely impact the completion of the transaction, including
industry or economic conditions outside of the control of Lattice
and Silicon Image. In addition, actual results are subject to other
risks and uncertainties that relate more broadly to Lattice and
Silicon Image’s overall business, including those more fully
described in Lattice’s filings with the SEC including its annual
report on Form 10-K for the fiscal year ended December 28, 2013,
and Lattice’s quarterly reports filed on Form 10-Q for the 2014
fiscal year, and those more fully described in Silicon Image’s
filings with the SEC including its annual report on Form 10-K for
the fiscal year ended December 31, 2013, and its quarterly reports
filed on Form 10-Q for the 2014 fiscal year.
You should not unduly rely on forward-looking statements because
actual results could differ materially from those expressed in any
forward-looking statements. In addition, any forward-looking
statement applies only as of the date on which it is made. Neither
Lattice nor Silicon Image plan to, and undertake no obligation to,
update any forward-looking statements to reflect events or
circumstances that occur after the date on which such statements
are made or to reflect the occurrence of unanticipated events.
Lattice Semiconductor Corporation, Lattice (& design), L
(& design), are either registered trademarks or trademarks of
Lattice Semiconductor Corporation or its subsidiaries in the United
States and/or other countries.
GENERAL NOTICE: Other product names used in this publication
are for identification purposes only and may be trademarks of their
respective holders.
For Lattice Semiconductor:Lattice Semiconductor
CorporationJoe Bedewi, 503-268-8000Chief Financial OfficerorGlobal
IR PartnersDavid Pasquale,
914-337-8801lscc@globalirpartners.comorFor Silicon Image,
Inc.:Alex Chervet,
408-616-4153Alex.Chervet@siliconimage.com
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