SANTA CLARA, Calif. and
SAN JOSE, Calif., Oct. 29, 2020 /PRNewswire/ -- Marvell Technology
Group Ltd. (NASDAQ: MRVL), a leader in infrastructure semiconductor
solutions, and Inphi Corporation (NASDAQ: IPHI), a leader in
high-speed data movement, today announced a definitive agreement,
unanimously approved by the boards of directors of both companies,
under which Marvell will acquire Inphi in a cash and stock
transaction. In conjunction with the transaction, Marvell intends
to reorganize so that the combined company will be domiciled in
the United States, creating a U.S.
semiconductor powerhouse with an enterprise value of approximately
$40 billion.
Inphi has built a leading high-speed data interconnect platform
uniquely suited to meet the insatiable demand for increased
bandwidth and low power for the cloud data centers and global
networks of the future. Inphi's high-speed electro-optics portfolio
provides the connectivity fabric for cloud data centers and wired
and wireless carrier networks, just as Marvell's copper physical
layer portfolio does for enterprise and future in-vehicle networks.
Combining Marvell's storage, networking, processor, and security
portfolio, with Inphi's leading electro-optics interconnect
platform, will position the combined company for end-to-end
technology leadership in data infrastructure. This highly
complementary transaction expands Marvell's addressable market,
strengthens customer base, and accelerates Marvell's leadership in
hyperscale cloud data centers and 5G wireless infrastructure.
Today's machine learning and other data-driven workloads have
expanded beyond the confines of the server and now span the entire
cloud data center, making the software-defined data center the new
computing paradigm. This trend drives hyper-connectivity within the
data center, putting electro-optical interconnects at the heart of
the cloud architecture. In addition, the need for bandwidth between
data centers continues to grow at astounding rates. Combined with
explosive Internet traffic growth and the rollout of new ultra-fast
5G wireless networks, the importance of Inphi's high-speed data
interconnect solutions will only accelerate. The combined company
will be uniquely positioned to serve the data-driven world,
addressing high growth, attractive end markets – cloud datacenter
and 5G.
Our combined scale will provide more resources and capabilities
to continue to invest and better manage the rapidly ramping process
technology costs. The transaction is expected to generate annual
run-rate synergies of $125 million to
be realized within 18 months after the transaction closes and is
expected to become accretive to Marvell's non-GAAP earnings per
share by the end of the first year after the transaction
closes.
"Our acquisition of Inphi will fuel Marvell's leadership in the
cloud and extend our 5G position over the next decade," said
Matt Murphy, president and CEO of
Marvell. "Inphi's technologies are at the heart of cloud data
center networks and they continue to extend their leadership with
innovative new products, including 400G data center interconnect
optical modules, which leverage their unique silicon photonics and
DSP technologies. We believe that Inphi's growing presence with
cloud customers will also lead to additional opportunities for
Marvell's DPU and ASIC products."
"Marvell and Inphi share a vision to enable the world's data
infrastructure and we have both transformed our respective
businesses to benefit from the strong secular growth expected in
the cloud data center and 5G wireless markets," said Ford Tamer,
President and CEO of Inphi. "Combining with Marvell significantly
increases our scale, accelerates our access to the next generations
of process technology, and opens up new opportunities in 5G
connectivity."
Upon closing, Ford Tamer, Inphi's President and CEO, will join
Marvell's Board of Directors.
Transaction Structure and Terms
Under the terms of the definitive agreement, the transaction
consideration will consist of $66 in
cash and 2.323 shares of stock of the combined company for each
Inphi share. Upon closing of the transaction, Marvell shareholders
will own approximately 83% of the combined company and Inphi
stockholders will own approximately 17% of the combined
company.
Marvell intends to finance the transaction with cash on hand,
and additional financing. Marvell has obtained debt financing
commitments from JPMorgan Chase Bank, N.A. The transaction is not
subject to any financing condition and is expected to close by the
second half of calendar 2021, subject to the approval of Marvell
shareholders and Inphi stockholders and the satisfaction of
customary closing conditions, including applicable regulatory
approvals.
Advisors
J.P. Morgan Securities LLC served as exclusive financial advisor
to Marvell and also provided committed financing for the
transaction and Hogan Lovells US LLP served as legal advisor.
Qatalyst Partners LP served as exclusive financial advisor to Inphi
and Pillsbury Winthrop Shaw Pittman LLP served as legal
advisor.
Marvell Preliminary Third Fiscal Quarter 2021 Results
Based on preliminary financial information, Marvell expects its
third quarter revenue to be in the range of $750 million +/- 2%. Further information
regarding third fiscal quarter results will be released on
December 3, 2020 at 1:45 p.m. Pacific Time. The preliminary revenue
results are unaudited, based on information available to management
as of the date of this release, and may be subject to further
changes upon completion of Marvell's standard quarter closing
procedures. Actual results may differ materially from these
preliminary results because of the completion of quarter-end
closing procedures, final adjustments and other developments
arising between now and the time that Marvell financial results are
finalized. This update does not present all necessary information
for an understanding of Marvell's financial condition as of
October 31, 2020, or its results of
operations for the quarter ended October 31,
2020.
Call/Webcast to Discuss Transaction
Interested parties may join a conference call Thursday, October 29, 2020 at 5:30 a.m. Pacific Time to discuss the transaction
by dialing 1 (844) 647-5488 in the U.S. or +1 (615) 247-0258
internationally, with the conference ID 6784634. A webcast of
the call can be accessed by visiting Marvell's investor relations
website. A replay will be available until November 5, 2020 by dialing 1 (855) 859-2056,
replay ID 6784634.
About Marvell
Marvell first revolutionized the digital storage industry by
moving information at speeds never thought possible.
Today, that same breakthrough innovation remains at the heart of
the company's storage, processing, networking, security and
connectivity solutions. With leading intellectual property
and deep system-level knowledge, Marvell's semiconductor solutions
continue to transform the enterprise, cloud, automotive, industrial
and consumer markets. To learn more, visit:
https://www.marvell.com.
Marvell and the M logo are registered trademarks of Marvell
and/or its affiliates in the US and/or elsewhere. Other names and
brands may be claimed as the property of others.
About Inphi
Inphi corporation is a leader in high-speed data movement. We
move big data fast, throughout the globe, between data centers, and
inside data centers. Inphi's expertise in signal integrity results
in reliable data delivery, at high speeds, over a variety of
distances. As data volumes ramp exponentially due to video
streaming, social media, cloud-based services, and wireless
infrastructure, the need for speed has never been greater. That's
where we come in. Customers rely on Inphi's solutions to develop
and build out the Service Provider and Cloud infrastructures, and
data centers of tomorrow. To learn more about Inphi, visit
www.inphi.com.
Inphi, the Inphi logo and Think fast are registered trademarks
of Inphi. All other trademarks used herein are the property of
their respective owners.
Investor Contacts:
Marvell Investor Relations:
Ashish Saran
408-222-0777
ir@Marvell.com
Inphi Corporate Contact:
Vernon P. Essi, Jr.
408-606-6524
investors@inphi.com
Additional Information and Where to Find It
This communication relates to a proposed transaction between
Marvell and Inphi. In connection with the proposed transaction,
Marvell and Inphi will cause the newly formed company which will
become the holding company of Marvell and Inphi following the
transaction ("HoldCo") to file a registration statement on Form S-4
with the Securities and Exchange Commission (the "SEC"), which will
include a document that serves as a joint proxy statement of
Marvell and Inphi and a prospectus of HoldCo referred to as a joint
proxy statement/prospectus. A joint proxy
statement/prospectus will be sent to all Inphi stockholders and all
Marvell shareholders. Each party also will file other documents
regarding the proposed transaction with the SEC. BEFORE MAKING ANY
VOTING DECISION, INVESTORS AND SECURITY HOLDERS OF INPHI AND
INVESTORS AND SECURITY HOLDERS OF MARVELL ARE URGED TO READ THE
REGISTRATION STATEMENT, JOINT PROXY STATEMENT/PROSPECTUS AND ALL
OTHER RELEVANT DOCUMENTS FILED OR THAT WILL BE FILED WITH THE SEC
IN CONNECTION WITH THE PROPOSED TRANSACTION AS THEY BECOME
AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE
PROPOSED TRANSACTION.
Investors, Marvell shareholders and Inphi stockholders may
obtain free copies of the joint proxy statement/prospectus (when
available) and other documents that are filed or will be filed with
the SEC by Marvell, Inphi or HoldCo through the website maintained
by the SEC at www.sec.gov.
The documents filed by Marvell with the SEC also may be obtained
free of charge at Marvell's website at www.marvell.com or upon
written request to Marvell Technology Group Ltd. at 5488 Marvell
Lane, Santa Clara, CA 95054.
The documents filed by Inphi with the SEC also may be obtained
free of charge at Inphi's website at www.inphi.com or upon written
request to Inphi Corporation at 110 Rio Robles, San Jose, California, 95134.
Participants in the Solicitation
Marvell and Inphi and their respective directors and executive
officers may be deemed to be participants in the solicitation of
proxies from Inphi's stockholders and from Marvell's shareholders
in connection with the proposed transaction. Information about
Inphi's directors and executive officers and their ownership of
Inphi's common stock is set forth in Inphi's proxy statement for
its 2020 Annual Meeting of Stockholders on Schedule 14A filed with
the SEC on April 21, 2020.
Information about Marvell's directors and executive officers is set
forth in Marvell's proxy statement for its 2020 Annual General
Meeting of Shareholders on Schedule 14A filed with the SEC on
May 28, 2020. To the extent that
holdings of Inphi's or Marvell's securities have changed since the
amounts printed in Inphi's or Marvell's proxy statement, such
changes have been or will be reflected on Statements of Change in
Ownership on Form 4 filed with the SEC. Additional information
regarding the interests of those persons and other persons who may
be deemed participants in the proposed transaction may be obtained
by reading the proxy statement/prospectus regarding the proposed
transaction when it becomes available. You may obtain free copies
of these documents as described in the preceding paragraph.
Cautionary Statement Regarding Forward Looking
Statements
This communication contains certain forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended, with respect to the proposed transaction between Marvell,
Inphi and HoldCo, including statements regarding the benefits of
the transaction, the anticipated timing of the transaction and the
products and markets of each company. These forward-looking
statements generally are identified by the words "believe,"
"project," "expect," "anticipate," "estimate," "intend,"
"strategy," "future," "opportunity," "plan," "may," "should,"
"will," "would," "will be," "will continue," "will likely result"
and similar expressions. Forward-looking statements are
predictions, projections and other statements about future events
that are based on current expectations and assumptions and, as a
result, are subject to risks and uncertainties. Many factors could
cause actual future events to differ materially from the
forward-looking statements in this press release, including but not
limited to: (i) the completion of the proposed transaction on
anticipated terms and timing, including obtaining shareholder and
regulatory approvals, anticipated tax treatment, unforeseen
liabilities and other conditions to the completion of the
transaction; (ii) failure to realize the anticipated benefits of
the proposed transaction, including as a result of delay in
completing the transaction or HoldCo's ability to integrate the
businesses of Marvell and Inphi or due to unexpected costs,
liabilities or delays; (iii) the ability of the parties to obtain
or consummate financing or refinancing related to the transactions
upon acceptable terms or at all; (iv) potential litigation relating
to the proposed transaction that could be instituted against
Marvell, HoldCo or Inphi or their respective directors; (v) the
risk that disruptions from the proposed transaction will harm
Marvell or Inphi's business, including current plans and
operations; (vi) the ability of Marvell or Inphi to retain and hire
key personnel; (vii) potential adverse reactions or changes to
business relationships resulting from the announcement or
completion of the proposed transaction; (viii) risks relating to
the value of the HoldCo shares to be issued in the transaction;
(ix) risks associated with third party contracts containing consent
and/or other provisions that may be triggered by the proposed
transaction; (x) the impact of public health crises, such as
pandemics (including coronavirus (COVID-19)) and epidemics and any
related company or government policies and actions to protect the
health and safety of individuals or government policies or actions
to maintain the functioning of national or global economies and
markets; (xi) legislative, regulatory and economic developments
affecting Marvell or Inphi's businesses; (xii) general economic and
market developments and conditions; (xiii) the evolving legal,
regulatory and tax regimes under which Marvell, HoldCo and Inphi
operate; (xiv) potential business uncertainty, including changes to
existing business relationships, during the pendency of the
proposed transaction that could affect Marvell's and/or Inphi's
financial performance; (xv) restrictions during the pendency of the
proposed transaction that may impact Marvell's or Inphi's ability
to pursue certain business opportunities or strategic transactions;
(xvi) unpredictability and severity of catastrophic events,
including, but not limited to, acts of terrorism or outbreak of war
or hostilities, as well as Marvell's and Inphi's response to any of
the aforementioned factors; (xvii) failure to receive the approval
of the securityholders of Marvell and/or Inphi; and (xviii) the
occurrence of any event, change or other circumstances that could
give rise to the termination of the merger agreement. The foregoing
list of factors is not exhaustive. You should carefully consider
the foregoing factors and the other risks and uncertainties that
affect the businesses of Marvell and Inphi described in the "Risk
Factors" section of their respective Annual Reports on Form 10-K,
Quarterly Reports on Form 10-Q and other documents filed by either
of them from time to time with the SEC. These filings identify and
address other important risks and uncertainties that could cause
actual events and results to differ materially from those contained
in the forward-looking statements. Forward-looking statements speak
only as of the date they are made. Readers are cautioned not to put
undue reliance on forward-looking statements, and Marvell and Inphi
assume no obligation and do not intend to update or revise these
forward-looking statements, whether as a result of new information,
future events or otherwise. Neither Marvell nor Inphi gives any
assurance that either Marvell or Inphi will achieve its
expectations.
No Offer or Solicitation
This communication is not intended to and shall not constitute
an offer to sell or the solicitation of an offer to sell or the
solicitation of an offer to buy any securities or a solicitation of
any vote of approval, nor shall there be any sale of securities in
any jurisdiction in which such offer, solicitation or sale would be
unlawful prior to registration or qualification under the
securities laws of any such jurisdiction. 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.
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SOURCE Marvell