Saifun to be acquired for $368m.

The deal, valued at $11.26 a share represents an 8.5% premium to Saifun's closing price on Friday of $10.38.

By ROBERT DANIEL, MARKETWATCH
October 9, 2007 08:28
1 minute read.

 
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MarketWatch: In-depth global business coverage Spansion Inc. said Monday it has agreed to acquire Netanya-based Saifun Semiconductors Ltd., an Israeli licensor of intellectual property for chipmakers, in a deal worth $368 million. The deal, valued at $11.26 a share represents an 8.5 percent premium to Saifun's closing price on Friday of $10.38. A year ago, Saifun's stock was trading close to $30 before beginning a decline that eventually wiped out two-thirds of the company's market value. Spansion shares closed Friday at $8.36. Spansion, of Sunnyvale, Calif., agreed to issue 0.7429 of a share plus about $5.05 cash for each Saifun share. After the deal, holders of Saifun, will control about 15% of Spansion. Spansion, previously a joint venture of Advanced Micro Devices and Fujitsu, produces flash memory, which has wireless-communication, automotive, networking and consumer-electronics applications. Since 2002, Spansion has licensed Saifun's NROM technology, which enables chipmakers to reduce costs and increase storage capacity. NROM "has formed the cornerstone of Spansion's proprietary MirrorBit technology," the companies said. The deal will expand Spansion's product line, enabling it to enter the technology-licensing business and eliminate its royalty payments to Saifun. And Spansion will be able to add Saifun's engineers, "who are already familiar with MirrorBit technology," the companies said. For the first six months of 2007, Saifun reported net income that fell 66% from the year-earlier period, to $6.8m., or 21 cents a share as revenue fell 42% to $12.4 m. Both companies' boards have approved the acquisition, and Saifun's chief executive, Boaz Eitan, has agreed to vote his 35% stake in the company for the deal. Subject to conditions including clearances from regulators as well as approval by Saifun's holders, the companies hope to close the deal in the first quarter. Citigroup Global Markets Inc. advised Spansion on the deal and Lehman Brothers advised Saifun. MarketWatch: In-depth global business coverage

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