IXYS Announces Agreement with Samsung Electronics to Acquire Its 4 and 8 Bit Microcontroller Business
MILPITAS, Calif. & BIEL, Switzerland--(BUSINESS WIRE)-- IXYS Corporation (Nasdaq: IXYS ) , an international power semiconductor and IC company, today announced it has executed a definitive agreement with Samsung Electronics to acquire Samsung’s 4-/8-bit microcontroller business for approximately $50 million. As part of the agreement, IXYS will receive nearly 80 products, inventories, intellectual property and other assets exclusively related to the 4-/8-bit business. The acquisition is subject to various customary closing conditions and is expected to be completed within four weeks from the date of signing of the definitive agreement. The net impact is expected to be accretive for IXYS in the fiscal year ending March 31, 2014.
"This acquisition provides increased revenues for our higher gross margin IC business, which includes our wholly-owned subsidiaries, IXYS IC Division and Zilog, a pioneer supplier of microcontrollers," said Dr. Nathan Zommer, Chairman and CEO of IXYS. "We plan to gain market share for our MCU and IC products, and expand our customer base in industrial, medical and consumer applications. The 4-/8-bit products fit with our mixed signal ICs and our power semiconductors, whereby we will be able to offer our customers complete solutions for power management -- from the digital control analog driver ICs to higher power devices. The development of this product portfolio has been a strategic decision as part of our ‘World of IXYS’ marketing and sales initiative.”
“Furthermore, with this agreement we expand our foundry relationship with Samsung. We have been strategic partners with Samsung Electronics for more than 25 years, and are looking forward to expanding this business affiliation. Given that some of these MCUs were based originally on Zilog’s legendary cores, we expect a seamless transition for the customer base and a quick integration within our Zilog MCU lines,” noted Dr. Zommer.
"We have executed a management decision based on the focus on mobile solutions that we are taking in our semiconductor business," said Dr. Ben Suh, Senior Vice President of Samsung Electronics System LSI Strategic Planning team. “We are confident that IXYS will embrace the microcontroller initiatives started by Samsung and continue to generate new products into this important market.”
According to recent research, the 4-/8-bit microcontroller segment is forecast to reach nearly $3.5 billion in 2013, with shipments of MCUs growing to 6.7 billion units. By some estimates, 4-/8-bit MCUs are expected to account for 23% of microcontroller sales in 2017.
Current 4-/8-bit products to be acquired by IXYS include MCUs for remote controllers, ultra-low power MCUs and a series of products for home appliances, consumer electronics and LCD displays. Applications include battery chargers, thermostats, boiler control, microwaves, e-bikes, LED lighting, power meters, blood pressure meters and smoke detectors.
"The products that we are gaining with Samsung’s 4-/8-bit business are complementary to IXYS' current IC/MCU business, and therefore we see positive synergies going forward," said Uzi Sasson, President and CFO for IXYS. "This acquisition provides us with greater critical mass in product volumes, the potential for better financial performance and diversification of revenue, all of which can enhance our global position and growth initiatives in the microcontroller market. In addition to bolstering IXYS’ product portfolio, this transaction highlights the strong cooperative relationship with Samsung. We are excited about our ability to continue working and partnering with the Samsung team.”
About IXYS Corporation
Since its founding in Silicon Valley, IXYS Corporation has been developing technology-driven products to improve energy conversion efficiency, generate clean energy, improve automation, and provide advanced products for the transportation, medical and telecommunications industries. IXYS, with its subsidiaries, is a worldwide pioneer in the development of power semiconductors, solid-state relays, high voltage integrated circuits (HVIC) and microcontrollers that are necessary in conserving energy and in reducing the world’s dependence on fossil fuels.
Diminishing natural resources, demand for renewable energy and environmental directives for energy efficiency represent a significant challenge. IXYS’ power semiconductors and mixed-signal integrated circuits (IC) play a vital role in reducing energy costs and consumption by optimizing the energy efficiency of everyday products. With an end-customer base of over 3,500 telecommunications, transportation, industrial, medical and consumer companies, IXYS is a worldwide recognized provider of advanced semiconductors.
Additional information may be obtained by visiting IXYS’ website at http://www.ixys.com, or by contacting the company directly.
Safe Harbor Statement
The foregoing press release contains forward-looking statements, including those related to the timing of closing, an accretive impact in fiscal 2014, plans for market share and expansion, complete solutions for power management, synergies, financial performance, revenue diversification and enhancements of our global position and growth initiatives. Actual results may vary materially from those contained in the forward-looking statements, due to adverse macro-economic events in Europe, Asia or the United States, changes in customer delivery schedules, the cancellation of orders, an unanticipated decline in our business, increased competition, cash flow difficulties, unanticipated technological hurdles, adverse changes in customer demand, increasing product costs, closing conditions, market acceptance of the acquisition and difficulties in integrating the acquisition, among other things. Further information on other factors that could affect IXYS is detailed and included in reports IXYS filed with the Securities and Exchange Commission including its Form 10-Q for the quarter ended December 31, 2012. IXYS undertakes no obligation to publicly release the results of any revisions to these forward-looking statements.
Uzi Sasson, 408-457-9000
President and CFO
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