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Amplifiers / Passive Components / Semiconductors / Integrated Circuits

RFMD® Completes Acquisition of Filtronic Compound Semiconductors Ltd

March 3, 2008
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GREENSBORO, N.C.--March 3, 2008--RF Micro Devices (Nasdaq GS: RFMD), a global leader in the design and manufacture of high-performance radio frequency systems and solutions, today announced the completion of its acquisition of Filtronic Compound Semiconductors Ltd, a wholly owned subsidiary of Filtronic PLC (LSE:FTC).

Under the terms of the transaction, RFMD paid an acquisition price of approximately 12.5 million pounds in cash for Filtronic Compound Semiconductors. The acquisition price included the purchase of Filtronic Compound Semiconductors' six-inch GaAs wafer fabrication facility ("fab") at Newton Aycliffe, United Kingdom, and the purchase of Filtronic Compound Semiconductors' millimeter wave RF semiconductor business.

RFMD expects the addition of Filtronic Compound Semiconductors' high-volume GaAs fab will significantly reduce RFMD's GaAs pHEMT manufacturing costs and provide incremental GaAs manufacturing capacity sufficient to support near-term anticipated growth. Additionally, RFMD expects the addition of Filtronic Compound Semiconductors' microwave and millimeter wave component business will strengthen the product portfolio of RFMD's Multi-Market Products Group (MPG) and be accretive to RFMD's target margin profile for its multi-market business.

Bob Bruggeworth, president and chief executive officer of RFMD, said, "With the acquisition of Filtronic Compound Semiconductors, RFMD significantly benefits in three ways. First, the acquisition significantly lowers our overall GaAs cost structure, which we believe will result in improved margins as calendar year 2008 progresses. Second, RFMD's GaAs capacity is increased by approximately 30 percent, giving us the flexibility to capture near-term demand upside and defer future fab-related capital outlays. Finally, we acquire a strong microwave and millimeter wave business that adds profitable, high-margin revenue to MPG. We are thrilled to add Filtronic Compound Semiconductors' employees, customers and technologies to RFMD, and we look forward to the growth and cost reduction opportunities this acquisition makes possible."

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