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Will ISSI give in to Cypress' offer?

Posted: 21 May 2015     Print Version  Bookmark and Share

Keywords:acquisition  integrated circuits  DRAM  SRAM  NOR flash 

It appears that another acquisition is on the horizon for Cypress Semiconductor.

Last week the company sent a letter to the board of directors of Integrated Silicon Solution, Inc. (ISSI), proposing an acquisition of all outstanding shares. The offer, for $19.75 per share in cash, trumps one made by a Chinese consortium led by Summitview Capital, reported Reuters, and values ISSI at $627.3 million, based on about 31.8 million shares outstanding as of May 1, according to Thomson Reuters data.

ISSI designs and markets high performance integrated circuits for the automotive, communications, industrial and digital consumer market. The fabless semiconductor company's primary products are low, medium and high density DRAM, and high speed and low power SRAM. It also designs and markets NOR flash products and high performance analogue and mixed signal integrated circuits.

ISSI has responded to the Cypress offer, reiterating the previously announced Agreement and Plan of Merger dated as of March 12, 2015 with Uphill Investment Co., pursuant to which Uphill agreed to acquire all of the outstanding common stock of ISSI for $19.25 per share in cash. In the statement, the company said "the Cypress offer either constitutes or is reasonably expected to lead to a Superior Proposal" and that it expects to participate or engage in discussions or negotiations with Cypress regarding the offer. ISSI had previously stated it would hold a special shareholder meeting on June 3 to consider the Uphill proposal.

Cypress is making the offer for ISSI as it digests its most recent acquisition; in late December, it made a $4 billion bid for Spansion. As reported by EE Times in March, the companies said they expected to have combined revenues approaching $2 billion and save $135 million in annual costs within three years, and that they have little overlap in their product lines. The combination of Cypress and Spansion could make it the fourth or fifth largest supplier of memories and MCUs to the automotive industry.


Cypress acquisition target ISSI licensed Spansion's HyperFlash memory and HyperBus interface to help expand its flash product portfolio for automotive and industrial customers. Cypress has since acquired Spansion.

Should Cypress be successful in acquiring ISSI, it would further bolster its offerings in the automotive segment, which is growing thanks in part to on-board infotainment systems. In January, ISSI announced full production of automotive-grade serial NOR flash products as part of its efforts to expand its market in growth applications such as Advanced Driver Assistance Systems (ADAS), camera applications and radar systems. It also announced an agreement to license Spansion's HyperFlash memory and HyperBus interface to help expand its flash product portfolio for automotive and industrial customers.

Cypress acquired Ramtron in 2012.

- Gary Hilson
  EE Times U.S.

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