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Lattice Semiconductor seals Silicon Image buyout worth $600M

Posted: 28 Jan 2015     Print Version  Bookmark and Share

Keywords:tender offer  acquisition  shareholders 

Lattice Semiconductor Corporation is set to buy Silicon Image Inc. in an all-cash tender offer of $7.30 per share. This represents an equity value of approximately $600 million (or approximately $450 million on an enterprise value basis) and a 34.6 per cent premium to the average closing price over the last 90 trading days and a 23.7 per cent premium to the closing price on January 26.

The transaction has been unanimously approved by the boards of directors of both companies and is expected to close by the end of March 2015. Pursuant to the definitive agreement, a subsidiary of Lattice Semiconductor will commence a tender offer for 100 per cent of the outstanding shares of Silicon Image common stock for $7.30 per share in cash. The tender offer is required to be commenced within 10 business days and to remain open for at least 20 business days after launch. Following successful completion of the tender offer, any shares not acquired in the tender offer will be acquired in a second-step merger at the same per share cash price.

The directors and executive officers of Silicon Image have agreed to tender their shares in the tender offer. Closing of the tender offer is subject to customary closing conditions, including the expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act and there being validly tendered and not withdrawn a number of shares of Silicon Image common stock equal to at least a majority of the total outstanding shares of Silicon Image common stock.

The transaction will be funded through a combination of cash on hand and new debt financing. The company has received a financing commitment of $350 million from Jefferies Finance LLC. The proposed transaction is not subject to a financing condition.

Darin G. Billerbeck, Lattice Semiconductor's President and Chief Executive Officer, said, "For the first time in the semiconductor industry, a single company will combine the design flexibility and time to market benefits of FPGAs, with the highly integrated, function and cost optimisation benefits of ASSP solutions."

"Lattice shares our commitment to building upon Silicon Image's rich history of standards creation and the development of new wired and wireless connectivity innovations," said Silicon Image CEO Camillo Martino. "This transaction is the culmination of a strategic process conducted under the direction of our board of directors, and represents a significant creation of value for our shareholders."


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