ALISO VIEJO, Calif.,
Nov. 18, 2015 /PRNewswire/
-- Microsemi Corporation (Nasdaq: MSCC), a leading
provider of semiconductor solutions differentiated by power,
security, reliability and performance, today announced that it has
increased its proposal to acquire PMC-Sierra, Inc. (Nasdaq: PMCS)
in a cash and stock transaction. Under the terms of Microsemi's
proposal, PMC shareholders would receive $9.22 in cash and 0.0771x of a share of Microsemi
common stock for each share of PMC common stock. The implied
enterprise value is $2.3 billion, net
of PMC's net cash balance as of Sept. 27,
2015. Based on the closing stock price of Microsemi on
Nov. 17, 2015, the transaction is
valued at $12.05 per PMC share.
"The board of PMC chose not to recommend to their shareholders
our previous proposal, which was $0.17 per share higher than the existing offer
from Skyworks," said James J.
Peterson, Microsemi's chairman and CEO. "Our revised offer
delivers even more value to shareholders and we have addressed
PMC's preference in increasing the cash component of our proposal.
Because we are not subject to the same uncertainty regarding
regulatory approvals, our unique ability to close this transaction
represents the best approach to realizing the value of PMC in a
timely manner, consistent with the board's fiduciary responsibility
to its shareholders."
The revised proposal is expected to be immediately accretive to
Microsemi's non-GAAP EPS and free cash flow. Microsemi anticipates
achieving more than $100 million in
annual cost synergies with greater than $75
million of those to be realized in the first full quarter of
combined operations. Microsemi estimates approximately $0.60 of non-GAAP EPS accretion in the first full
year after closing the transaction.
About Microsemi
Microsemi Corporation (Nasdaq: MSCC)
offers a comprehensive portfolio of semiconductor and system
solutions for communications, defense & security, aerospace and
industrial markets. Products include high-performance and
radiation-hardened analog mixed-signal integrated circuits, FPGAs,
SoCs and ASICs; power management products; timing and
synchronization devices and precise time solutions, setting the
world's standard for time; voice processing devices; RF solutions;
discrete components; security technologies and scalable anti-tamper
products; Ethernet solutions; Power-over-Ethernet ICs and midspans;
as well as custom design capabilities and services. Microsemi is
headquartered in Aliso Viejo,
Calif., and has approximately 3,600 employees globally.
Learn more at www.microsemi.com.
Microsemi and the Microsemi logo are registered trademarks or
service marks of Microsemi Corporation and/or its affiliates.
Third-party trademarks and service marks mentioned herein are the
property of their respective owners.
Cautionary Note Concerning Forward-Looking
Statements
This release contains forward-looking statements
based on current expectations or beliefs, as well as a number of
assumptions about future events, and these statements are subject
to factors and uncertainties that could cause actual results to
differ materially from those described in the forward-looking
statements. The reader is cautioned not to put undue reliance on
these forward-looking statements, which are not a guarantee of
future performance and are subject to a number of uncertainties and
other factors, many of which are outside the control of Microsemi.
The forward-looking statements in this release address a variety of
subjects including, for example, statements regarding Microsemi's
offer to acquire PMC-Sierra Inc. ("PMC"), its financing and the
expected timing of the proposed transaction, the potential benefits
of the acquisition (including the potentially accretive and
synergistic benefits), Microsemi's expected future performance
(including expected results of operations and financial guidance),
and the combined company's future financial condition, operating
results, strategy and plans. Statements including words such as
"believes," "expects," "anticipates," "intends," "estimates,"
"plan," "will," "may," "look forward," "intend," "guidance,"
"future" or similar expressions are forward-looking statements.
Potential risks and uncertainties include, but are not limited to,
such factors as the ultimate outcome of any possible transaction
between Microsemi and PMC, including the possibilities that
Microsemi will not pursue a transaction with PMC or that PMC will
reject a transaction with Microsemi; if a transaction between
Microsemi and PMC were to occur, the ultimate outcome and results
of integrating the operations of Microsemi and PMC, the ultimate
outcome of Microsemi's operating strategy applied to PMC and the
ultimate ability to realize synergies; the effects of the business
combination of Microsemi and PMC, including the combined company's
future financial condition, operating results, strategy and plans;
negative or worsening worldwide economic conditions or market
instability; downturns in the highly cyclical semiconductor
industry; our ability to successfully implement our acquisitions
strategy or integrate other acquired companies; uncertainty as to
the future profitability of acquired businesses, and delays in the
realization of, or the failure to realize, any accretion from
acquisition transactions; acquiring, managing and integrating new
operations, businesses or assets, and the associated diversion of
management attention or other related costs or difficulties;
Microsemi's reliance on government contracts for a significant
portion of its sales, including impacts of any termination or
renegotiation of such contracts, uncertainties of governmental
appropriations and national defense policies and priorities and
effects of any past or future government shutdowns; risks related
to the company's international operations and sales, including
political instability, trade restrictions and sanctions,
restrictions in the transfer or repatriation of funds, currency
fluctuations and availability of transportation services; potential
non-realization of expected orders or non-realization of backlog;
failure to make sales indicated by the company's book-to-bill
ratio; intense competition in the semiconductor industry and
resultant downward price pressure; the effect of events such as
natural disasters and related disruptions on our operations; the
concentration of the factories that service the semiconductor
industry; delays in beginning production, implementing production
techniques, resolving problems associated with technical equipment
malfunctions, or issues related to government or customer
qualification of facilities; our dependence on third parties for
key functions; increases in the costs of credit and the
availability of credit or additional capital only under more
restrictive conditions or not at all; changes to laws or
regulations; unanticipated changes in Microsemi's tax obligations,
results of tax examinations or exposure to additional income tax
liabilities; changes in generally accepted accounting principles;
principal, liquidity and counterparty risks related to Microsemi's
holdings in securities; inability to develop new technologies and
products to satisfy changes in customer demand or the development
by the company's competitors of products that decrease the demand
for Microsemi's products; unfavorable or declining conditions in
end markets; inability of Microsemi's compound semiconductor
products to compete successfully with silicon-based products;
production delays related to new compound semiconductors;
variability of the company's manufacturing yields; potential
effects of system outages; inability by Microsemi to fulfill
customer demand and resulting loss of customers; variations in
customer order preferences; difficulties foreseeing future demand;
rises in inventory levels and inventory obsolescence; environmental
or other regulatory matters or litigation, or any matters involving
contingent liabilities or other claims; the uncertainty of
litigation, the costs and expenses of litigation, the potential
material adverse effect litigation could have on Microsemi's
business and results of operations if an adverse determination in
litigation is made, and the time and attention required of
management to attend to litigation; difficulties in determining the
scope of, and procuring and maintaining, adequate insurance
coverage; difficulties and costs of protecting patents and other
proprietary rights; the hiring and retention of qualified personnel
in a competitive labor market; any circumstances that adversely
impact the end markets of acquired businesses; and difficulties in
closing or disposing of operations or assets or transferring work,
assets or inventory from one plant to another. In addition to these
factors and any other factors mentioned elsewhere in this news
release, the reader should refer as well to the factors,
uncertainties or risks identified in Microsemi's most recent Form
10-K and any subsequent Form 10-Q reports filed by Microsemi with
the SEC. Additional risk factors may be identified from time to
time in Microsemi's future filings. The forward-looking statements
included in this release speak only as of the date hereof, and
Microsemi does not undertake any obligation to update these
forward-looking statements to reflect subsequent events or
circumstances. Guidance is provided only on a non-GAAP basis due to
the inherent difficulty of forecasting the timing or amount of
certain items that have been excluded from the forward-looking
non-GAAP measures, and a reconciliation to the comparable GAAP
guidance has not been provided because certain factors that are
materially significant to Microsemi's ability to estimate the
excluded items are not accessible or estimable on a forward-looking
basis.
Additional Information and Where to Find It
This
communication does not constitute an offer to buy or solicitation
of an offer to sell any securities. This communication relates to a
proposal which Microsemi Corporation ("Microsemi") has made for a
business combination transaction with PMC-Sierra Inc. ("PMC"). In
furtherance of this proposal and subject to future developments,
Microsemi (and, if a negotiated transaction is agreed to, PMC) may
file one or more registration statements, prospectuses, proxy
statements or other documents with the U.S. Securities and Exchange
Commission ("SEC"). This communication is not a substitute for any
registration statement, prospectus, proxy statement or other
document Microsemi and/or PMC may file with the SEC in connection
with the proposed transaction. INVESTORS AND SECURITY HOLDERS OF
MICROSEMI AND PMC ARE URGED TO READ THE REGISTRATION STATEMENT,
PROSPECTUS, PROXY STATEMENT AND OTHER DOCUMENTS FILED WITH THE SEC
CAREFULLY IN THEIR ENTIRETY IF AND WHEN THEY BECOME AVAILABLE AS
THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED
TRANSACTION. Any definitive proxy statement (if and when available)
will be mailed to stockholders of PMC. Investors and security
holders will be able to obtain free copies of these documents (if
and when available) and other documents filed with the SEC by
Microsemi through the web site maintained by the SEC at
http://www.sec.gov.
Certain Information Regarding Participants
Microsemi
and certain of its directors and executive officers may be deemed
to be participants in any solicitation with respect to the proposed
transaction under the rules of the SEC. Security holders may obtain
information regarding the names and interests of Microsemi's
directors and executive officers from Microsemi's Annual Report on
Form 10-K for the year ended September 27,
2014, which was filed with the SEC on November 12, 2015, and Microsemi's proxy
statement for the 2015 Annual Meeting of Shareholders, which was
filed with the SEC on December 19,
2014. These documents can be obtained free of charge from
the sources indicated above. Additional information regarding the
interests of these participants in the proxy solicitation and a
description of their direct and indirect interests, by security
holdings or otherwise, will also be included in any proxy statement
and other relevant materials to be filed with the SEC if and when
they become available.
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SOURCE Microsemi Corporation