MILPITAS, Calif., Oct. 26, 2011 /PRNewswire/ -- LSI Corporation
(NYSE: LSI) today announced that it has signed a definitive
agreement to acquire SandForce, Inc., the leading provider of flash
storage processors for enterprise and client flash solutions and
solid state drives (SSDs). Under the agreement, LSI will pay
approximately $322 million in cash,
net of cash assumed, and assume approximately $48 million of unvested stock options and
restricted shares held by SandForce employees.
SandForce's award-winning products include flash storage
processors at the heart of PCIe flash adapters and SSDs. Flash
storage processors provide the intelligence required to deliver the
performance and low-latency benefits of flash storage in enterprise
and client applications. With market-proven, differentiated
DuraClass™ technology, SandForce flash storage processors improve
the reliability, endurance and power efficiency of flash-based
storage solutions.
The acquisition greatly enhances LSI's competitive position in
the fast-growing server and storage PCIe flash adapter market,
where the WarpDrive™ family of products from LSI already uses
SandForce flash storage processors. The complementary combination
of LSI's custom capability and SandForce's standard product
offering propels LSI into an industry-leading position in the
rapidly growing, high-volume flash storage processor market space
for ultrabook, notebook and enterprise SSD and flash solutions.
"Flash-based solutions are critical for accelerating application
performance in servers, storage and client devices," said
Abhi Talwalkar, LSI president and
chief executive officer. "Adding SandForce's technology to LSI's
broad storage portfolio is consistent with our mission to
accelerate storage and networking. The acquisition represents a
significant, rapidly growing market opportunity for LSI over the
next several years."
Michael Raam, SandForce president
and CEO, said, "The combination of SandForce and LSI allows us to
deliver differentiated solutions in the PCIe flash adapter segment
by tightly integrating flash memory and management. In addition,
leveraging our flash storage processors with LSI's comprehensive IP
portfolio and leading-edge silicon design platforms will lead to
innovative solutions."
The transaction is expected to close early in the first quarter
of 2012 subject to customary closing conditions and regulatory
approvals. Upon closing, the SandForce team will become part of
LSI's newly formed Flash Components Division, with Raam as general
manager.
LSI expects the acquisition to be neutral to non-GAAP* earnings
per share in 2012. The company will provide further details during
its conference call at 2 p.m. PDT
today and discuss third quarter results and the fourth quarter 2011
business outlook.
* GAAP refers to Generally
Accepted Accounting Principles. Non-GAAP earnings exclude goodwill
and other intangible asset impairment, stock-based compensation,
amortization of acquisition-related intangibles, purchase
accounting effect on inventory, restructuring of operations and
other items, net, and gain/loss on sale/write-down of investments.
It also excludes the income tax effect associated with the
above-mentioned items.
|
|
|
Forward-Looking Statements: This news release contains
forward-looking statements that are based on the current opinions
and estimates of management. These statements are subject to
certain risks and uncertainties that could cause actual results to
differ materially from those anticipated in the forward-looking
statements. Factors that could cause LSI's actual results to differ
materially from those set forth in the forward-looking statements
include, but are not limited to: our ability to obtain all
necessary regulatory approvals for the acquisition, the successful
consummation of the acquisition; our ability to successfully
integrate and manage the SandForce business and retain its key
employees; our ability to achieve anticipated synergies and to
develop integrated new products following our acquisition of
SandForce; our ability to eliminate costs related to the external
storage systems business that we sold to NetApp; our ability to
repurchase our common stock at prices we believe to be
advantageous; the impact of the recent flooding in Thailand; our reliance on major customers and
suppliers; our ability to keep up with rapid technological change;
our ability to compete successfully in competitive markets;
fluctuations in the timing and volumes of customer demand; the
unavailability of appropriate levels of manufacturing capacity; and
general industry and macro-economic conditions. For additional
information, see the documents filed by LSI with the Securities and
Exchange Commission, and specifically the risk factors set forth in
the company's most recent reports on Form 10-K and 10-Q. LSI
disclaims any intention or obligation to update or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise.
About LSI
LSI Corporation (NYSE: LSI) designs semiconductors and software
that accelerate storage and networking in datacenters and mobile
networks. Our technology is the intelligence critical to enhanced
application performance. The company applies its technology in
solutions created in collaboration with our partners. More
information is available at www.lsi.com.
About SandForce
SandForce flash storage processors enable ubiquitous deployment
of flash memory into primary and I/O intensive data storage
applications. SandForce Driven SSDs dramatically optimize
mission-critical application reliability, IT infrastructure ROI,
green power preservation, and everyday computing user experiences.
Founded in 2006, SandForce was initially funded by leading venture
capital investors DCM and Storm Ventures and later joined by
Translink Capital, and Canaan Partners. More information is
available at www.sandforce.com.
Editor's Notes:
- All LSI news releases (financial, acquisitions, manufacturing,
products, technology, etc.) are issued exclusively by PR Newswire
and are immediately thereafter posted on the company's external
website, http://www.lsi.com.
- LSI, the LSI & Design logo and WarpDrive are trademarks or
registered trademarks of LSI Corporation.
- All other brand or product names may be trademarks or
registered trademarks of their respective companies.
SOURCE LSI Corporation