Trident Microsystems Buys Some of Micronas Products
Trident Microsystems, a leader in high-performance semiconductor system solutions for the multimedia and digital television markets, announced that it has entered into a definitive agreement with Micronas Semiconductor Holding AG to acquire selected assets of the frame rate converter, demodulator and audio product lines of Micronas' Consumer Division. The consideration payable to Micronas will consist of 7.0 million shares of Trident common stock and warrants to acquire up to 3.0 million additional Trident shares.
"As we previously communicated, we are committed to investing in Trident's future and are determined to emerge from these challenging times as a leader in the global DTV market. This acquisition is an important step in accomplishing this goal, diversifies our product offering and serves as a catalyst for Trident to become a preferred supplier of the DTV market, which is expanding into a multimedia connected home," said Sylvia Summers Couder, Trident's Chief Executive Officer and President. "This acquisition will increase Trident's revenue base and we expect it to be accretive in the first full quarter after the close."
Strategic Benefits of the Acquisition
The acquisition broadens Trident's existing product and intellectual property portfolios and augments its technical resources, enabling the company to address a larger portion of the DTV market and to expand its tier one customer base.
Expanding Trident's product offering to include Micronas' FRC products will increase Trident's total addressable market through sales of FRCs to customers for incorporation into the DTV display panel, a market segment new to Trident. The addition of Micronas' demodulators to Trident's product portfolio expands the company's existing demodulator offering to include nearly all of the world's digital TV standards. In addition, the future integration of Micronas' best-in-class discrete audio and demodulation technologies into Trident's SoCs with best-in-class picture quality is expected to provide Trident with one of the most comprehensive and innovative product roadmaps in the DTV industry.
"We believe this acquisition will enable Trident uniquely to help customers deliver a highly interactive digital television, a central point in the home for providing compelling multimedia content and connectivity to the consumer," said Ms. Summers.
"Trident's purchase of best-in-class products, technology and intellectual property from Micronas' Consumer division will immediately expand its reach into the home consumer semiconductor market," commented Wolfgang Kalsbach, Chief Executive Officer of Micronas.
Financial Benefits of the Acquisition
Trident expects to expand its revenue base and leverage its low cost operations in Asia to reduce its projected near-term operating losses. Trident anticipates that combined net revenue for the quarter ending September 30, 2009 will be approximately $35 million and expects non-GAAP operating loss and cash consumption to improve from its current outlook. The transaction improves Trident's visibility in achieving its previously stated long-term financial model targets.
"With this transaction we can accelerate the pace of innovation, and leverage our industry leading cost structure and strong balance sheet to position the Company for both long-term revenue and earnings growth, benefiting our customers, employees and shareholders," said Ms. Summers.