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e2v technologies plc, the specialist developer and manufacturer of high technology components and subsystems, has announced that its subsidiary, e2v Holdings Inc., has conditionally agreed to buy QP Semiconductor Inc. for an initial cash consideration of $65 M.
In addition, deferred consideration of up to $15 M may be payable to QP shareholders, subject to future operating profit performance targets being achieved by the company. e2v may satisfy up to $5 M of the deferred consideration through the issue of new ordinary shares to QP shareholders. All other deferred consideration is to be issued in cash. The overall cash consideration will be funded through existing bank facilities.
QP Semiconductor is a well established and leading US-based designer and supplier of specialty semiconductor components used in military and aerospace applications. Its extensive product range addresses a niche sector within this market, designed to deliver high performance in extreme conditions.
Through this acquisition e2v believes that QP will strengthen the group's market position in high reliability specialist semiconductors as well as expand e2v's business from this niche sector by around 40 percent. The enlarged group will benefit from the ability to better service complementary global markets and establish a US manufacturing base servicing the aerospace and defense sector for e2v.
Keith Attwood, e2v’s chief executive said, “We are delighted to announce the proposed acquisition of QP, which represents a significant opportunity for the Group and is an important step in establishing an operational footprint in the USA. It will increase our market share in the aerospace and defense sector and expand our relationship with contractors to the US Department of Defense.”
He added, “This acquisition will significantly enhance our presence in the high reliability specialist semiconductor market and the board believes that the acquisition of QP will deliver earnings enhancement in the financial year ending March 2009 and material enhancement in the year ending March 2010.”
Completion of the acquisition is conditional on the approval of e2v's shareholders, which will be sought at a general meeting to be held on 18 September 2008. Completion is also conditional on the receipt of certain other regulatory approvals and is expected to take place on 30 September 2008.
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