SAN JOSE, Calif., Dec. 1, 2014 /PRNewswire/ -- Cypress
Semiconductor Corp. (NASDAQ: CY) and Spansion, Inc. (NYSE: CODE)
today announced a definitive agreement to merge in an all-stock,
tax-free transaction valued at approximately $4 billion. The post-merger company will generate
more than $2 billion in revenue
annually and create a leading global provider of microcontrollers
and specialized memories needed in today's embedded systems.
"This merger represents the combination of two smart,
profitable, passionately entrepreneurial companies that are No. 1
in their respective memory markets and have successfully
diversified into embedded processing," said Rodgers, Cypress's
founding president and CEO. "Our combined company will be a leading
provider of embedded MCUs and specialized memories. We will also
have extraordinary opportunities for EPS accretion due to the
synergy in virtually every area of our enterprises."
Under the terms of the agreement, Spansion shareholders will
receive 2.457 Cypress shares for each Spansion share they own. The
shareholders of each company will own approximately 50 percent of
the post-merger company. The company will have an eight-person
board of directors consisting of four Cypress directors, including
T.J. Rodgers and Eric Benhamou, and four Spansion directors,
including John Kispert and
Ray Bingham, the Spansion chairman,
who will serve as the non-executive chairman of the combined
company, which will be headquartered in San Jose, California and called Cypress
Semiconductor Corporation.
The merger is expected to achieve more than $135 million in cost synergies on an annualized
basis within three years and to be accretive to non-GAAP earnings
within the first full year after the transaction closes. The
combined company will continue to pay $0.11 per share in quarterly dividends to
shareholders.
"Bringing together these high-performing organizations creates
operating efficiencies and economies of scale, and will deliver
maximum value for our shareholders, new opportunities for employees
and an improved experience for our customers," said John Kispert, CEO of Spansion. "With
unparalleled expertise, global reach in markets like Japan and market-leading products for
automotive, IoT, industrial and communications markets, the new
company is well positioned to deliver best-of-breed solutions and
execute on our long-term vision of adding value through embedded
system-on-chip solutions."
The closing of the transaction is subject to customary
conditions, including approval by Cypress and Spansion stockholders
and review by regulators in the U.S., Germany and China. The transaction has been unanimously
approved by the boards of directors of both companies. Cypress and
Spansion expect the deal to close in the first half of 2015.
Jefferies LLC and Morgan Stanley & Co. LLC served as
financial advisors and Fenwick & West and Latham & Watkins
acted as legal counsel to Spansion. Qatalyst Partners acted as
financial advisor and Wilson Sonsini
Goodrich & Rosati acted as legal counsel to Cypress.
Conference Call and Webcast Information
Cypress and
Spansion will hold a joint conference call and webcast today at
4:30 P.M. ET (1:30 p.m. PT) to discuss this announcement. The
conference call may be accessed by dialing 1-517-623-4671 and
using the passcode CYPRESS. The live and archived webcast may be
accessed at Cypress's IR website at
http://investors.cypress.com/events.cfm and Spansion's IR website
at http://investor.spansion.com.
About Cypress
Cypress delivers high-performance,
mixed-signal, programmable solutions that provide customers with
rapid time-to-market and exceptional system value. Cypress
offerings include the flagship PSoC® 1, PSoC 3, PSoC 4 and PSoC 5
programmable system-on-chip families. Cypress is the world leader
in capacitive user interface solutions including CapSense® touch
sensing, TrueTouch® touchscreens, and trackpad solutions for
notebook PCs and peripherals. Cypress is a world leader in USB
controllers, which enhance connectivity and performance in a wide
range of consumer and industrial products. Cypress is also the
world leader in SRAM and nonvolatile RAM memories. Cypress serves
numerous major markets, including consumer, mobile handsets,
computation, data communications, automotive, industrial and
military. Cypress trades on the NASDAQ Global Select Market under
the ticker symbol CY. Visit Cypress online at www.cypress.com.
Cypress and the Cypress logo, PSoC, CapSense and TrueTouch are
registered trademarks of Cypress Semiconductor Corporation. All
other trademarks are property of their owners.
About Spansion
Spansion (NYSE: CODE) is a global
leader in embedded systems solutions. Spansion's flash memory,
microcontrollers, analog and mixed-signal products drive the
development of faster, intelligent, secure and energy efficient
electronics. Spansion is at the heart of electronic systems,
connecting, controlling, storing and powering everything from
automotive electronics and industrial systems to the highly
interactive and immersive consumer devices that are enriching
people's daily lives. For more information, visit
http://www.spansion.com.
Spansion®, the Spansion logo, and combinations thereof, are
trademarks and registered trademarks of Spansion LLC in
the United States and other
countries. Other names used are for informational purposes only and
may be trademarks of their respective owners.
Forward-Looking Statements
This communication
contains forward-looking statements within the meaning of the "safe
harbor" provisions of the Private Securities Litigation Reform Act
of 1995, including with respect to the anticipated timing,
completion and effects of the proposed merger between Cypress and
Spansion. These statements are based on management's current
expectations and beliefs, and are subject to a number of factors
and uncertainties that could cause actual results to differ
materially from those described in the forward-looking statements.
These forward-looking statements include statements about future
financial and operating results; benefits of the transaction to
customers, stockholders and employees; potential synergies and cost
savings; the ability of the combined company to drive growth and
expand customer and partner relationships; and other statements
regarding the proposed transaction. Forward-looking statements may
contain words such as "will be," "will," "expected," "anticipate,"
"continue," or similar expressions, and include the assumptions
that underlie such statements. The following factors, among others,
could cause actual results to differ materially from those
described in the forward-looking statements: failure of the Cypress
or Spansion stockholders to approve the proposed merger; failure to
achieve regulatory approval; the challenges and costs of closing,
integrating, restructuring and achieving anticipated synergies; the
ability to retain key employees, customers and suppliers; and other
factors, including those set forth in the most current Form 10-K,
Form 10-Q and 8-K reports filed by Cypress and Spansion with the
Securities and Exchange Commission (the "SEC"). All forward-looking
statements are based on management's estimates, projections and
assumptions as of the date hereof, and. Cypress and Spansion
are under no obligation (and expressly disclaim any such
obligation) to update or revise their forward-looking statements
whether as a result of new information, future events, or
otherwise.
Non-GAAP Financial Measures
This communication may
contain certain non-GAAP financial measures, which management
believes are useful to investors and others in evaluating business
combinations. Further detail and reconciliations between the
non-GAAP financial measures and the GAAP financial measures are
available in the most recent press releases of Spansion and Cypress
concerning quarterly financial results, filed with the SEC on Form
8-K.
No Offer or Solicitation
This communication does not
constitute an offer to sell or the solicitation of an offer to buy
any securities or a solicitation of any vote or approval with
respect to the proposed merger or otherwise. No offer of securities
shall be made except by means of a prospectus meeting the
requirements of Section 10 of the Securities Act of 1933, as
amended.
Additional Information and Where to Find It
In
connection with the proposed merger, Cypress intends to file a
registration statement on Form S-4, which will include a
preliminary prospectus and related materials to register the shares
of Cypress common stock to be issued in the merger, and Cypress and
Spansion intend to file a joint proxy statement/prospectus and
other documents concerning the proposed merger with the SEC.
INVESTORS AND SECURITY HOLDERS ARE URGED TO READ THE REGISTRATION
STATEMENT, THE JOINT PROXY STATEMENT/PROSPECTUS AND ANY OTHER
RELEVANT DOCUMENTS TO BE FILED WITH THE SEC CAREFULLY WHEN THEY
BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION
ABOUT CYPRESS, SPANSION, AND THE PROPOSED MERGER. Investors and
security holders will be able to obtain free copies of the
registration statement and the joint proxy statement/prospectus
(when they are available) and any other documents filed by Cypress
and Spansion with the SEC at the SEC's website at www.sec.gov. They
may also be obtained for free by contacting Cypress Investor
Relations at http://investors.cypress.com/contactus.cfm or by
telephone at (408) 943-2656 or by contacting Spansion Investor
Relations at investor.relations@spansion.com or by telephone
at (408) 962-2500. The contents of the websites referenced above
are not deemed to be incorporated by reference into the
registration statement or the joint proxy statement/prospectus.
Participants in the Solicitation
Each of Spansion and
Cypress and their respective executive officers and directors may
be deemed to be participants in the solicitation of proxies from
their respective stockholders with respect to the transactions
contemplated by the merger agreement. Information regarding the
persons who may, under the rules of the SEC, be deemed participants
in the solicitation of Cypress or Spansion security holders in
connection with the proposed merger will be set forth in the
registration statement and the joint proxy statement/prospectus
when filed with the SEC. Information regarding Spansion's executive
officers and directors is included in Spansion's Proxy Statement
for its 2014 Annual Meeting of Stockholders, filed with the SEC on
April 18, 2014, and its Current
Report on Form 8-K, filed with the SEC on August 19, 2014, and information regarding
Cypress' executive officers and directors is included in Cypress'
Proxy Statement for its 2014 Annual Meeting of Stockholders, filed
with the SEC on March 28, 2014 and
its Current Report on Form 8-K, filed with the SEC on April 2, 2014. Copies of the foregoing documents
may be obtained as provided above. Certain executive officers and
directors of Cypress and Spansion have interests in the transaction
that may differ from the interests of Cypress and Spansion
stockholders generally. These interests will be described in the
joint proxy statement/prospectus when it becomes available.
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SOURCE Spansion Inc.