|By Business Wire||
|May 22, 2014 07:30 AM EDT||
Microchip Technology Incorporated (NASDAQ:MCHP), a leading provider of microcontroller, mixed-signal, analog and Flash-IP solutions, and ISSC Technologies Corporation (ISSC) (TW OTC:5261) today announced that Microchip has signed a definitive agreement to acquire ISSC, a leading provider of low power Bluetooth and advanced wireless solutions for the Internet Of Things (IoT) market. ISSC is publicly traded on the GreTai Securities Market and is headquartered in Hsinchu, Taiwan (Hsinchu Science Park) with customer service or research activities in Shenzhen, China and Torrance, California. In calendar year 2013, ISSC had net sales of US$69.2 million and an operating margin of 18.9% based on their reported results under International Financial Reporting Standards.
Under the terms of the transaction, Microchip will commence a tender offer to acquire all of the outstanding shares of ISSC for New Taiwan (NT)$143 per share (approximately US$4.74 per share, based on an assumed exchange rate of NT$30.15 per US$) in cash, and acquire any remaining shares pursuant to a follow-on merger at NT$143 per share minus any dividends paid by ISSC prior to the close of the transaction. The transaction represents a total equity value of about NT$9.9 billion (approximately US$328.5 million), and a total enterprise value of about NT$8.9 billion (approximately US$294.3 million), after excluding ISSC’s cash and investments on its balance sheet of approximately NT$1 billion (approximately US$34.2 million). The acquisition is expected to be accretive to Microchip’s non-GAAP earnings per share in the first full quarter after completion of the tender offer at which time Microchip will own the majority of the outstanding shares of ISSC and consolidate its financial statements with Microchip’s.
The acquisition has been approved by the Boards of Directors of each company. The tender offer is expected to close in the third quarter of calendar 2014. The follow-on merger is expected to close in the fourth quarter of calendar 2014, subject to approval of the follow-on merger by ISSC stockholders, regulatory approvals and other customary closing conditions. In connection with the transaction, Microchip has entered into an agreement with certain ISSC shareholders holding approximately 28 percent of the outstanding shares of ISSC pursuant to which such shareholders have committed to tender approximately 17 percent of the outstanding shares of ISSC, which represents all unrestricted ISSC shares owned by them.
“We are delighted to have ISSC join the Microchip team. ISSC’s deep domain knowledge in Bluetooth and wireless technologies, and strong position in the Consumer markets, complement many of Microchip’s initiatives in wireless and IoT areas. We believe that combining ISSC’s strengths in wireless products and technology with Microchip’s brand, channel and operational strengths will enable significant cross selling opportunities,” said Ganesh Moorthy, COO of Microchip Technology.
“We are pleased to join Microchip Technology, a premier company in the semiconductor industry. Microchip has demonstrated consistent profitability, technology leadership and growth in its core businesses. We believe that this acquisition provides the best vehicle for us to realize significant value for ISSC shareholders, as well as the opportunities from scale of the much stronger sales and manufacturing platforms of Microchip,” said Max Wu, Chairman of ISSC.
“This transaction represents the first major overseas acquisition by Microchip and the purchase will be funded with a portion of Microchip’s foreign cash and will not require any additional borrowings from our line of credit. We believe the combination of a very strategic transaction that provides low power Bluetooth technology, ISSC’s strengths and capabilities and our use of foreign cash makes this a compelling transaction for the shareholders of both companies,” said Steve Sanghi, Microchip’s President and CEO.
Conference Call Information and Availability of Presentation Materials:
Microchip will host a conference call today, May 22, 2014 at 8:30 a.m. (Eastern Time) to discuss this release. This call will be simulcast over the Internet at www.microchip.com. The webcast will be available for replay until May 29, 2014.
A telephonic replay of the conference call will be available at approximately 12:00 p.m. (Eastern Time) on May 22, 2014 and will remain available until 5:00 p.m. (Eastern Time) on May 29, 2014. Interested parties may listen to the replay by dialing 719-457-0820 and entering access code 9153635.
You may also view certain presentation materials that we will refer to on the conference call on Microchip’s website at www.microchip.com. The same presentation materials will be available on the webcast of the conference call listed above.
Forward Looking Statements:
The statements in this release relating to expecting the acquisition to be accretive to Microchip’s non-GAAP earnings per share in the first full quarter after completion of the tender offer, expecting the tender offer to close in the third quarter of calendar 2014, expecting the follow-on merger to close in the fourth quarter of calendar 2014, ISSC complementing many of Microchip’s initiatives, combining ISSC’s strengths with Microchip’s strengths will enable significant cross selling opportunities, belief that the acquisition provides the best vehicle for ISSC to realize significant value for its shareholders, as well as the opportunities from scale, the purchase price being funded with a portion of Microchip’s foreign cash and will not require any additional borrowings, belief that the combination of a very strategic transaction and use of foreign cash makes this a compelling transaction for the shareholders of both companies, are forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to a number of business, economic, legal and other risks that are inherently uncertain and difficult to predict, including, but not limited to: the actual timing of the closing of the acquisition, the satisfaction of the conditions to closing in the acquisition agreement, any termination of the acquisition agreement, changes in demand or market acceptance of the products of Microchip or ISSC and the products of their respective customers, changes in demand or market acceptance of Microchip’s products and the products of its customers; competitive developments; the costs and outcome of any current or future litigation involving Microchip, ISSC or the acquisition transaction; the effect of the acquisition on Microchip’s and ISSC‘s existing relationships with customers and vendors and their operating results and businesses; the progress and costs of development of Microchip and ISSC products and the timing and market acceptance of those new products; Microchip’s ability to successfully integrate ISSC‘s operations and employees and retain key employees; and general economic, industry or political conditions in the United States or internationally. For a detailed discussion of these and other risk factors, please refer to the SEC filings of Microchip including those on Forms 10-K and 10-Q. You can obtain copies of Forms 10-K and 10-Q and other relevant documents for free at Microchip’s website (www.microchip.com) (as applicable), or the SEC's website (www.sec.gov), or from commercial document retrieval services.
Stockholders of Microchip and ISSC are cautioned not to place undue reliance on the forward-looking statements in this press release, which speak only as of the date such statements are made. Neither Microchip nor ISSC undertakes any obligation to publicly update any forward-looking statements to reflect events, circumstances or new information after this May 22, 2014 press release, or to reflect the occurrence of unanticipated events.
About Microchip Technology
Microchip Technology Inc. (NASDAQ: MCHP) is a leading provider of microcontroller, mixed-signal, analog and Flash-IP solutions, providing low-risk product development, lower total system cost and faster time to market for thousands of diverse customer applications worldwide. Headquartered in Chandler, Arizona, Microchip offers outstanding technical support along with dependable delivery and quality. For more information, visit the Microchip website at www.microchip.com.
ISSC Technologies Corporation (TW OTC:5261) is a leading developer of advanced wireless solutions. Its award-winning KleanWire™ technology enables world-class personal Bluetooth products to enrich your life wirelessly. ISSC is a market leader in Bluetooth SOC solutions for wireless Headset, Speaker, Connectivity, and HID products. Founded in 1999 and publicly traded on the Taiwan GreTai Securities Market under the code "5261" in 2013, ISSC is headquartered in Hsinchu, Taiwan (Hsinchu Science Park) and has customer service or research activities in Shenzhen, China and Torrance, California. For more information, go to www.issc-tech.com.
The Internet of Things will greatly expand the opportunities for data collection and new business models driven off of that data. In her session at @ThingsExpo, Esmeralda Swartz, CMO of MetraTech, discussed how for this to be effective you not only need to have infrastructure and operational models capable of utilizing this new phenomenon, but increasingly service providers will need to convince a skeptical public to participate. Get ready to show them the money!
Nov. 27, 2014 11:00 AM EST Reads: 1,767
The Internet of Things will put IT to its ultimate test by creating infinite new opportunities to digitize products and services, generate and analyze new data to improve customer satisfaction, and discover new ways to gain a competitive advantage across nearly every industry. In order to help corporate business units to capitalize on the rapidly evolving IoT opportunities, IT must stand up to a new set of challenges. In his session at @ThingsExpo, Jeff Kaplan, Managing Director of THINKstrategies, will examine why IT must finally fulfill its role in support of its SBUs or face a new round of...
Nov. 27, 2014 10:00 AM EST Reads: 1,798
One of the biggest challenges when developing connected devices is identifying user value and delivering it through successful user experiences. In his session at Internet of @ThingsExpo, Mike Kuniavsky, Principal Scientist, Innovation Services at PARC, described an IoT-specific approach to user experience design that combines approaches from interaction design, industrial design and service design to create experiences that go beyond simple connected gadgets to create lasting, multi-device experiences grounded in people's real needs and desires.
Nov. 27, 2014 08:00 AM EST Reads: 1,730
Enthusiasm for the Internet of Things has reached an all-time high. In 2013 alone, venture capitalists spent more than $1 billion dollars investing in the IoT space. With "smart" appliances and devices, IoT covers wearable smart devices, cloud services to hardware companies. Nest, a Google company, detects temperatures inside homes and automatically adjusts it by tracking its user's habit. These technologies are quickly developing and with it come challenges such as bridging infrastructure gaps, abiding by privacy concerns and making the concept a reality. These challenges can't be addressed w...
Nov. 27, 2014 07:45 AM EST Reads: 1,929
The Domain Name Service (DNS) is one of the most important components in networking infrastructure, enabling users and services to access applications by translating URLs (names) into IP addresses (numbers). Because every icon and URL and all embedded content on a website requires a DNS lookup loading complex sites necessitates hundreds of DNS queries. In addition, as more internet-enabled ‘Things' get connected, people will rely on DNS to name and find their fridges, toasters and toilets. According to a recent IDG Research Services Survey this rate of traffic will only grow. What's driving t...
Nov. 27, 2014 07:00 AM EST Reads: 1,963
Scott Jenson leads a project called The Physical Web within the Chrome team at Google. Project members are working to take the scalability and openness of the web and use it to talk to the exponentially exploding range of smart devices. Nearly every company today working on the IoT comes up with the same basic solution: use my server and you'll be fine. But if we really believe there will be trillions of these devices, that just can't scale. We need a system that is open a scalable and by using the URL as a basic building block, we open this up and get the same resilience that the web enjoys.
Nov. 27, 2014 06:45 AM EST Reads: 2,042
Connected devices and the Internet of Things are getting significant momentum in 2014. In his session at Internet of @ThingsExpo, Jim Hunter, Chief Scientist & Technology Evangelist at Greenwave Systems, examined three key elements that together will drive mass adoption of the IoT before the end of 2015. The first element is the recent advent of robust open source protocols (like AllJoyn and WebRTC) that facilitate M2M communication. The second is broad availability of flexible, cost-effective storage designed to handle the massive surge in back-end data in a world where timely analytics is e...
Nov. 27, 2014 06:45 AM EST Reads: 1,914
We are reaching the end of the beginning with WebRTC, and real systems using this technology have begun to appear. One challenge that faces every WebRTC deployment (in some form or another) is identity management. For example, if you have an existing service – possibly built on a variety of different PaaS/SaaS offerings – and you want to add real-time communications you are faced with a challenge relating to user management, authentication, authorization, and validation. Service providers will want to use their existing identities, but these will have credentials already that are (hopefully) i...
Nov. 27, 2014 04:00 AM EST Reads: 1,601
"Matrix is an ambitious open standard and implementation that's set up to break down the fragmentation problems that exist in IP messaging and VoIP communication," explained John Woolf, Technical Evangelist at Matrix, in this SYS-CON.tv interview at @ThingsExpo, held Nov 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA.
Nov. 27, 2014 04:00 AM EST Reads: 1,624
How do APIs and IoT relate? The answer is not as simple as merely adding an API on top of a dumb device, but rather about understanding the architectural patterns for implementing an IoT fabric. There are typically two or three trends: Exposing the device to a management framework Exposing that management framework to a business centric logic Exposing that business layer and data to end users. This last trend is the IoT stack, which involves a new shift in the separation of what stuff happens, where data lives and where the interface lies. For instance, it's a mix of architectural styles ...
Nov. 26, 2014 11:30 PM EST Reads: 1,804
Cultural, regulatory, environmental, political and economic (CREPE) conditions over the past decade are creating cross-industry solution spaces that require processes and technologies from both the Internet of Things (IoT), and Data Management and Analytics (DMA). These solution spaces are evolving into Sensor Analytics Ecosystems (SAE) that represent significant new opportunities for organizations of all types. Public Utilities throughout the world, providing electricity, natural gas and water, are pursuing SmartGrid initiatives that represent one of the more mature examples of SAE. We have s...
Nov. 26, 2014 06:00 PM EST Reads: 1,709
P2P RTC will impact the landscape of communications, shifting from traditional telephony style communications models to OTT (Over-The-Top) cloud assisted & PaaS (Platform as a Service) communication services. The P2P shift will impact many areas of our lives, from mobile communication, human interactive web services, RTC and telephony infrastructure, user federation, security and privacy implications, business costs, and scalability. In his session at @ThingsExpo, Robin Raymond, Chief Architect at Hookflash, will walk through the shifting landscape of traditional telephone and voice services ...
Nov. 26, 2014 02:00 PM EST Reads: 1,967
The Internet of Things is tied together with a thin strand that is known as time. Coincidentally, at the core of nearly all data analytics is a timestamp. When working with time series data there are a few core principles that everyone should consider, especially across datasets where time is the common boundary. In his session at Internet of @ThingsExpo, Jim Scott, Director of Enterprise Strategy & Architecture at MapR Technologies, discussed single-value, geo-spatial, and log time series data. By focusing on enterprise applications and the data center, he will use OpenTSDB as an example t...
Nov. 25, 2014 09:30 PM EST Reads: 2,078
Explosive growth in connected devices. Enormous amounts of data for collection and analysis. Critical use of data for split-second decision making and actionable information. All three are factors in making the Internet of Things a reality. Yet, any one factor would have an IT organization pondering its infrastructure strategy. How should your organization enhance its IT framework to enable an Internet of Things implementation? In his session at Internet of @ThingsExpo, James Kirkland, Chief Architect for the Internet of Things and Intelligent Systems at Red Hat, described how to revolutioniz...
Nov. 24, 2014 07:00 PM EST Reads: 2,186
Bit6 today issued a challenge to the technology community implementing Web Real Time Communication (WebRTC). To leap beyond WebRTC’s significant limitations and fully leverage its underlying value to accelerate innovation, application developers need to consider the entire communications ecosystem.
Nov. 24, 2014 12:00 PM EST Reads: 1,915
The definition of IoT is not new, in fact it’s been around for over a decade. What has changed is the public's awareness that the technology we use on a daily basis has caught up on the vision of an always on, always connected world. If you look into the details of what comprises the IoT, you’ll see that it includes everything from cloud computing, Big Data analytics, “Things,” Web communication, applications, network, storage, etc. It is essentially including everything connected online from hardware to software, or as we like to say, it’s an Internet of many different things. The difference ...
Nov. 24, 2014 11:00 AM EST Reads: 2,280
Cloud Expo 2014 TV commercials will feature @ThingsExpo, which was launched in June, 2014 at New York City's Javits Center as the largest 'Internet of Things' event in the world.
Nov. 24, 2014 09:00 AM EST Reads: 2,145
SYS-CON Events announced today that Windstream, a leading provider of advanced network and cloud communications, has been named “Silver Sponsor” of SYS-CON's 16th International Cloud Expo®, which will take place on June 9–11, 2015, at the Javits Center in New York, NY. Windstream (Nasdaq: WIN), a FORTUNE 500 and S&P 500 company, is a leading provider of advanced network communications, including cloud computing and managed services, to businesses nationwide. The company also offers broadband, phone and digital TV services to consumers primarily in rural areas.
Nov. 23, 2014 07:30 PM EST Reads: 2,263
"There is a natural synchronization between the business models, the IoT is there to support ,” explained Brendan O'Brien, Co-founder and Chief Architect of Aria Systems, in this SYS-CON.tv interview at the 15th International Cloud Expo®, held Nov 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA.
Nov. 23, 2014 12:00 PM EST Reads: 2,214
The major cloud platforms defy a simple, side-by-side analysis. Each of the major IaaS public-cloud platforms offers their own unique strengths and functionality. Options for on-site private cloud are diverse as well, and must be designed and deployed while taking existing legacy architecture and infrastructure into account. Then the reality is that most enterprises are embarking on a hybrid cloud strategy and programs. In this Power Panel at 15th Cloud Expo (http://www.CloudComputingExpo.com), moderated by Ashar Baig, Research Director, Cloud, at Gigaom Research, Nate Gordon, Director of T...
Nov. 23, 2014 07:45 AM EST Reads: 2,318