SMSC Acquires Conexant Systems for $284 Million

SMSC is acquiring Conexant Systems for about $284 million. SMSC will purchase all of the outstanding shares of Conexant in a stock and cash transaction and assume the debt of Conexant. The transaction has already been approved by the boards of directors of both companies. SMSC is a semiconductor company that provides Smart Mixed-Signal Connectivity solutions. Conexant Systems is a supplier of semiconductor solutions for imaging, audio, embedded modem, and video surveillance applications.

SMSC discussed the agreement to acquire Conexant on its third quarter of fiscal 2011 earnings conference call this morning. A replay of the call will be available from today through January 17, 2011. The replay dial-in number is 888-203-1112 in the U.S. or 719-457-0820 for international callers. The replay passcode is 7244148. A webcast of the call, along with presentation materials, is accessible via the investor relations section of SMSC’s website.

SMSC – Conexant Merger Highlights

  • For each share of Conexant, stockholders will receive about $2.25
    • $1.125 in cash
    • Fraction of a share of SMSC common stock equal to $1.125 divided by the volume weighted average price of SMSC common stock
  • Total cash consideration to be paid in the transaction is about $98 million
  • Total number of shares of SMSC common stock to be issued (including the assumption of outstanding Conexant restricted stock units) is about 2.9 to 3.6 million
  • Transaction is expected to close in the first half of calendar 2011
  • SMSC expects to realize approximately $8 to $10 million in annualized pre-tax cost synergies by the end of SMSC’s fourth quarter of fiscal 2012 as a result of the consolidation of support functions and optimization of the supply chain across a larger base

More information: SMSC | Conexant Systems