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RF Micro Devices Inc. (RFMD) announced that, as a result of the pending merger of Jazz Semiconductor with a wholly owned subsidiary of Acquicor Technology Inc., RFMD expects to sell its equity interest in Jazz Semiconductor for an aggregate cash consideration of approximately $24 to $27 M.
Upon completion of the merger, which is expected in the first quarter of calendar year 2007, Jazz Semiconductor will become a wholly owned subsidiary of Acquicor. Acquicor is a company formed by Gilbert F. Amelio, Ellen M. Hancock and Steve Wozniak for the purpose of acquiring one or more operating businesses in the technology, multimedia and networking sectors.
Shu Li, president and CEO of Jazz Semiconductor, stated, "Jazz Semiconductor has enjoyed an exceptional relationship with RFMD. We look forward to the continued evolution of this relationship as RFMD launches new highly integrated mixed signal products built on Jazz silicon and as we continue our development efforts in advanced RF silicon semiconductor processes."
Bill Pratt, co-founder and chief technical officer of RFMD, stated, "RFMD and Jazz have worked together since 2002 developing state-of-the-art silicon process technologies targeted for next-generation mobile devices. RFMD's next-generation single-chip EDGE transceiver, which we expect will ramp at Jazz in the first half of calendar year 2007, utilizes a specialized CMOS process jointly developed between the two companies. Additionally, our existing agreements with Jazz regarding supply, wafer credits and joint development activities remain intact, and we expect to continue a mutually beneficial partnership following the merger."
RFMD expects to take a non-cash GAAP charge in its second quarter to reduce the carrying value of its original investment in Jazz. Prior to the announcement of the pending Jazz/Acquicor transaction, RFMD had valued its investment in Jazz at approximately $60 M.
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