Skyworks Acquires Majority Interest and Expects
Transaction to be Immediately Accretive to Margins and EPS;
Expected to Close Before the End of Fiscal
2014;
JV Complements Existing Strategic Filter
Partnerships
Skyworks Solutions, Inc. (NASDAQ: SWKS), an innovator of high
performance analog semiconductors enabling a broad range of end
markets, today announced the creation of a joint venture with
Panasonic Corporation, one of the largest electronic product
manufacturers in the world, to design, develop and deliver high
performance filters including surface acoustic wave (SAW) and
temperature compensated (TC) SAW devices. At the core of the joint
venture is Panasonic Filter Division’s engineering and process
talent, expertise in filter design and leading edge products as
well as 412 fundamental filter patents and patent applications.
“We believe this new venture leverages the core strengths of
both companies to better serve the high volume filter market and
positions us to substantially grow the business, benefiting our
customers and employees,” said Shigeru Ono, director of Panasonic’s
Circuit Components Business Division.
“We are excited to be joining forces with Panasonic in bringing
highly innovative filters to the exploding mobile connectivity and
Internet of Things markets,” said David J. Aldrich, president and
chief executive officer of Skyworks. “Panasonic has a long heritage
in SAW filter products and is the clear performance leader and
largest volume producer of rapidly emerging TC SAW filters with
shipments already approaching a quarter of a billion units. Our
joint venture structure capitalizes on Panasonic’s acoustic
filtering and piezoelectric leadership while further augmenting
Skyworks’ product breadth and integration capabilities. Together we
intend to deliver the world’s highest performance, lowest cost and
shortest cycle time solutions. Further, Skyworks’ joint venture
with Panasonic is complementary to our strategic investments in
high frequency bulk acoustic filters. As a result, we can now
develop customized solutions for any band configuration where
filter technology is applicable, spanning high, mid and low band
frequencies. In short, Skyworks has covered the RF spectrum with
best in class filter products, by targeted band, allowing us to
offer differentiated architectures for the most demanding customer
applications.”
About the Joint Venture with Panasonic
At closing, Skyworks will hold 66 percent of the newly created
entity with Panasonic retaining 34 percent. The transaction
encompasses the products, working capital, manufacturing equipment
and intellectual property of Panasonic’s Filter Division. The joint
venture will be comprised of approximately 590 employees and
headquartered in Osaka, Japan with design centers and operations at
facilities in Japan and Singapore.
For consideration, Skyworks will make a cash payment of $148.5
million to Panasonic for its share of the new venture. This
investment is expected to be immediately accretive to Skyworks’
margins and earnings per share. Skyworks and Panasonic expect the
transaction to close before the end of the third calendar quarter
of 2014, subject to customary closing conditions.
Filter Market Drivers and Panasonic’s Leadership
The insatiable demand for always-on connectivity and ever
increasing user data demands have driven a proliferation of bands
and the addition of 4G/LTE capabilities. In fact, 3GPP now has more
than 45 sanctioned bands. This is significantly increasing the
demand for filters and especially for high performance TC SAW
filters which enable the dense packing of bands. The need for world
class sensitivity and the increasing co-existence issues, due to
simultaneous operation of GPS, WiFi, Bluetooth, and cellular radios
necessitate the extremely high quality filtering enabled by
Panasonic’s technology.
Panasonic's high performance filter portfolio offers several
demonstrable advantages including:
- Reduced size and weight
- Higher selectivity
- Excellent Q and low insertion loss
- Reliability and stability under harsh
environments
- Lower distortion
- Field proven, high volume
production
About Panasonic
Panasonic Corporation is a worldwide leader in the development
and engineering of electronic technologies and solutions for
customers in residential, non-residential, mobility and personal
applications. Since its founding in 1918, the company has expanded
globally and now operates over 500 consolidated companies
worldwide, recording consolidated net sales of 7.30 trillion yen
for the year ended March 31, 2013. Committed to pursuing new value
through innovation across divisional lines, the company strives to
create a better life and a better world for its customers. For more
information about Panasonic, please visit the company’s website at
http://panasonic.net/.
About Skyworks
Skyworks Solutions, Inc. is an innovator of high performance
analog semiconductors. Leveraging core technologies, Skyworks
supports automotive, broadband, wireless infrastructure, energy
management, GPS, industrial, medical, military, wireless
networking, smartphone and tablet applications. The Company’s
portfolio includes amplifiers, attenuators, circulators,
demodulators, detectors, diodes, directional couplers, front-end
modules, hybrids, infrastructure RF subsystems, isolators, lighting
and display solutions, mixers, modulators, optocouplers,
optoisolators, phase shifters, PLLs/synthesizers/VCOs, power
dividers/combiners, power management devices, receivers, switches
and technical ceramics.
Headquartered in Woburn, Mass., Skyworks is worldwide with
engineering, manufacturing, sales and service facilities throughout
Asia, Europe and North America. For more information, please visit
Skyworks’ Web site at: www.skyworksinc.com.
Skyworks’ Safe Harbor Statement
This news release includes "forward-looking statements" intended
to qualify for the safe harbor from liability established by the
Private Securities Litigation Reform Act of 1995. These
forward-looking statements include without limitation information
relating to our ability to leverage the strengths of the joint
venture combination to better serve the high volume filter market
and position the joint venture to substantially grow new business,
our ability to broaden our product breadth and integration
capabilities and to deliver the world’s highest performance, lowest
cost and shortest cycle time solutions, our ability to offer a
differentiated and expanded product roadmap, and whether the joint
venture investment will be immediately accretive to our margins and
earnings per share. Forward-looking statements can often be
identified by words such as "anticipates," "expects," "forecasts,"
"intends," "believes," "plans," "may," "will," or "continue," and
similar expressions and variations or negatives of these words. All
such statements are subject to certain risks, uncertainties and
other important factors that could cause actual results to differ
materially and adversely from those projected, and may affect our
future operating results, financial position and cash flows.
These risks, uncertainties and other important factors include,
but are not limited to: uncertainty regarding global economic and
financial market conditions; the susceptibility of the
semiconductor industry and the markets addressed by our, and our
customers', products to economic downturns; the timing,
rescheduling or cancellation of significant customer orders and our
ability, as well as the ability of our customers, to manage
inventory; losses or curtailments of purchases or payments from key
customers, or the timing of customer inventory adjustments; the
availability and pricing of third party semiconductor foundry,
assembly and test capacity, raw materials and supplier components;
changes in laws, regulations and/or policies that could adversely
affect either (i) the economy and our customers’ demand for our
products or (ii) the financial markets and our ability to raise
capital; our ability to develop, manufacture and market innovative
products in a highly price competitive and rapidly changing
technological environment; economic, social, military and
geo-political conditions in the countries in which we, our
customers or our suppliers operate, including security and health
risks, possible disruptions in transportation networks and
fluctuations in foreign currency exchange rates; fluctuations in
our manufacturing yields due to our complex and specialized
manufacturing processes; delays or disruptions in production due to
equipment maintenance, repairs and/or upgrades; our reliance on
several key customers for a large percentage of our sales;
fluctuations in the manufacturing yields of our third party
semiconductor foundries and other problems or delays in the
fabrication, assembly, testing or delivery of our products; our
ability to timely and accurately predict market requirements and
evolving industry standards, and to identify opportunities in new
markets; uncertainties of litigation, including potential disputes
over intellectual property infringement and rights, as well as
payments related to the licensing and/or sale of such rights; our
ability to rapidly develop new products and avoid product
obsolescence; our ability to retain, recruit and hire key
executives, technical personnel and other employees in the
positions and numbers, with the experience and capabilities, and at
the compensation levels needed to implement our business and
product plans; lengthy product development cycles that impact the
timing of new product introductions; unfavorable changes in product
mix; the quality of our products and any remediation costs; shorter
than expected product life cycles; problems or delays that we may
face in shifting our products to smaller geometry process
technologies and in achieving higher levels of design integration;
and our ability to continue to grow and maintain an intellectual
property portfolio and obtain needed licenses from third parties,
as well as other risks and uncertainties, including, but not
limited to, those detailed from time to time in our filings with
the Securities and Exchange Commission.
The forward-looking statements contained in this news release
are made only as of the date hereof, and we undertake no obligation
to update or revise the forward-looking statements, whether as a
result of new information, future events or otherwise.
Note to Editors: Skyworks and Skyworks Solutions are trademarks
or registered trademarks of Skyworks Solutions, Inc. or its
subsidiaries in the United States and in other countries. All other
brands and names listed are trademarks of their respective
companies.
Skyworks Media Relations:Pilar Barrigas, (949)
231-3061orSkyworks Investor Relations:Stephen Ferranti,
(781) 376-3056
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