| From: Sam | 6/28/2022 8:14:53 AM | | | | | | Silicon Motion Announces Expiration of Hart-Scott-Rodino Waiting Period for MaxLinear’s Proposed Acquisition of Silicon Motion
GLOBENEWSWIRE 8:00 AM ET 6/28/2022
Symbol Last Price Change | SIMO | 83.43 | 0 (0%) | | MXL | 35.25 | 0 (0%) | | QUOTES AS OF 04:00:00 PM ET 06/27/2022 |
TAIPEI, Taiwan and MILPITAS, Calif., June 28, 2022 (GLOBE NEWSWIRE) -- Silicon Motion Technology Corporation(SIMO) (“Silicon Motion”), a global leader in NAND flash controllers for solid state storage devices, today announced the expiration of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the “HSR Act”), with respect to the previously announced agreement under which MaxLinear, Inc.(MXL) (“MaxLinear”) will acquire Silicon Motion(SIMO) in a cash and stock transaction in which each American Depositary Share (ADS) of Silicon Motion(SIMO), which represents four ordinary shares of Silicon Motion(SIMO), will receive $93.54 in cash and 0.388 shares of MaxLinear(MXL) common stock, and each ordinary share of Silicon Motion(SIMO) will receive $23.385 in cash and 0.097 shares of MaxLinear(MXL) common stock.
The expiration of the HSR waiting period occurred at 11:59 p.m. ET on June 27, 2022, which was a condition to the closing of the pending transaction. The closing of the transaction is subject to the satisfaction of the remaining customary closing conditions, including approval by Silicon Motion’s security holders and the receipt of regulatory approval in the People’s Republic of China.
Cautionary Statement Regarding Forward-Looking Statements
Information provided in this press release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements are based on Silicon Motion’s and MaxLinear’s current expectations, estimates and projections about the expected date of closing of the proposed transaction and the potential benefits thereof, their businesses and industry, management’s beliefs and certain assumptions made by Silicon Motion(SIMO) and MaxLinear(MXL), all of which are subject to change. The forward-looking statements include, but are not limited to, statements about the expected timing of the Merger, the satisfaction or waiver of any conditions to the proposed Merger, anticipated benefits, growth opportunities and other events relating to the proposed Merger, and projections about Silicon Motion’s business and its future revenues, expenses and profitability, and, in some cases, you can identify forward-looking statements by terminology such as “may,” “will,” “should,” “expect,” “intend,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “potential,” “potentially”, “continue,” “could”, “seek,” “see”, “would”, “might”, “continue”, “target” or the negatives of these terms or other comparable terminology that convey uncertainty of future events or outcomes. All forward-looking statements by their nature address matters that involve risks and uncertainties, many of which are beyond our control, and are not guarantees of future results, such as statements about the consummation of the proposed transaction and the anticipated benefits thereof. These and other forward-looking statements are not guarantees of future results and are subject to risks, uncertainties and assumptions that could cause actual results to differ materially from those expressed in any forward-looking statements. Although such statements are based on Silicon Motion’s own information and information from other sources Silicon Motion(SIMO) believes to be reliable, you should not place undue reliance on them and caution must be exercised in relying on forward-looking statements. These statements involve risks and uncertainties, and actual results may differ materially from those expressed or implied in these forward-looking statements for a variety of reasons. Potential risks and uncertainties include, but are not limited to, the risk that the transaction may not be completed on the anticipated terms and timing, in a timely manner or at all, which may adversely affect Silicon Motion’s or MaxLinear’s respective business and the price of the ordinary shares, par value $0.01 per share, of Silicon Motion(SIMO), Silicon Motion’s American Depositary Shares (ADSs) and shares of common stock, par value $0.0001, of MaxLinear(MXL) (“MaxLinear Common Stock”); uncertainties as to the timing of the consummation of the transaction and the potential failure to satisfy the conditions to the consummation of the transaction, including the receipt of certain governmental and regulatory approvals, anticipated tax treatment, unforeseen liabilities, future capital expenditures, revenues, expenses, earnings, synergies, economic performance, indebtedness, financial condition, losses, future prospects, business and management strategies for the management, expansion and growth of the parties’ businesses and other conditions to the completion of the transaction; the occurrence of any event, change or other circumstances that could give rise to the termination of the Merger Agreement, including the receipt by Silicon Motion(SIMO) of an unsolicited proposal from a third party; the effect of the announcement or pendency of the transaction on the Company’s or MaxLinear’s respective business relationships, operating results, and business generally; the potential that the Company’s security holders may not approve the Merger; expected benefits, including financial benefits, of the transaction may not be realized; integration of the acquisition post-closing may not occur as anticipated, and the combined company’s ability to achieve the growth prospects and synergies expected from the transaction, as well as delays, challenges and expenses associated with integrating the combined company’s existing businesses, may occur; litigation related to the Merger or otherwise; unanticipated restructuring costs may be incurred or undisclosed liabilities assumed; attempts to retain key personnel and customers may not succeed; risks related to diverting attention from the parties’ ongoing business, including current plans and operations; changes in tax regimes, legislation or government regulations affecting the acquisition or the parties or their businesses; economic, social or political conditions that could adversely affect the Merger or the parties, including trade and national security policies and export controls and executive orders relating thereto, and worldwide government economic policies, including trade relations between the United States and China and the military conflict in Ukraine and related sanctions against Russia and Belarus; unpredictability and severity of catastrophic events, including, but not limited to, acts of terrorism or outbreak of war or hostilities, as well as the parties’ response to any of the aforementioned factors; exposure to inflation, currency rate and interest rate fluctuations and risks associated with doing business locally and internationally, as well as fluctuations in the market prices of the parties’ traded securities; potential business uncertainty or adverse reactions or changes to business relationships resulting from the announcement or completion of the Merger; potential negative changes in general economic conditions and market developments in the regions or the industries in which the parties’ operate; the loss of one or more key customers or the significant reduction, postponement, rescheduling or cancellation of orders from one or more customers as a result or in anticipation of the Merger or otherwise; the parties’ respective customers’ sales outlook, purchasing patterns, and inventory adjustments based on consumer demands and general economic conditions; risks associated with the ongoing global outbreak of COVID-19, including, but not limited to, the emergence of variants to the original COVID-19 strain such as the Delta and Omicron variants and related private and public sector measures; Silicon Motion’s ability to provide a safe working environment for employees during the COVID-19 pandemic or any other public health crises, including pandemics or epidemics; Silicon Motion’s and MaxLinear’s abilities to implement their business strategies; pricing trends, including Silicon Motion’s and the MaxLinear’s abilities to achieve economies of scale; uncertainty as to the long-term value of MaxLinear Common Stock; restrictions during the pendency of the proposed transaction that may impact the Company’s or MaxLinear’s ability to pursue certain business opportunities or strategic transactions; and the other risk factors discussed from time to time by Silicon Motion(SIMO) in the most recent Annual Report on Form 20-F and in any subsequent reports on Form 6-K, each of which is on file with or furnished to the Securities and Exchange Commission (the “SEC) and available at the SEC’s website at www.sec.gov. SEC filings for Silicon Motion(SIMO) are available on Silicon Motion’s website at siliconmotion.com. We assume no obligation to update any forward-looking statements, which apply only as of the date of this press release.
Additional Information and Where to Find It
This communication is being made in respect of the proposed transaction. MaxLinear(MXL) has filed a Registration Statement on Form S-4 with the SEC and Silicon Motion(SIMO) intends to provide to its security holders the Form S-4 and a proxy statement (the “Proxy Statement”) describing the Merger Agreement, the Merger, as well as the procedure for voting in person or by proxy at a meeting of Silicon Motion’s shareholders held for the purpose of seeking shareholder approval of the Merger Agreement, the Merger and transactions contemplated by the Merger Agreement (the “Silicon Motion Meeting”) and various other details related to the Silicon Motion Meeting. The Form S-4 is not complete and may be changed. Once finalized, the Form S-4 and the Proxy Statement will be sent or given to the security holders of Silicon Motion(SIMO) and will contain important information about the proposed transaction and related matters. This communication is not a substitute for the Form S-4 or the Proxy Statement or any other document that have been or may be filed or furnished by Silicon Motion(SIMO) or MaxLinear(MXL) with the SEC or provided to Silicon Motion’s security holders. Investors and security holders are urged to read each of the Form S-4 and the Proxy Statement in its entirety and other relevant documents filed with or furnished to the SEC or provided to Silicon Motion’s security holders in connection with the proposed transaction or incorporated by reference therein when they become available before making any voting or investment decision with respect to the proposed transaction because they will contain important information about the proposed transaction and the parties to the proposed transaction. |
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| To: Sam who wrote (2560) | 6/28/2022 10:07:47 AM | | From: Elroy | | | | Is that a big deal? It sounds like all they need now is Chinese approval, and SIMO shareholder's vote?
The gap between deal close and current price is about 30%, still fairly large. |
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| From: Elroy | 7/1/2022 1:09:14 PM | | | | | | From the MU call
There are consumer demand and inventory-related headwinds impacting the industry and consequently our fiscal Q4 outlook.
Across the industry, there are cost challenges stemming from supply chain and inflationary pressures; however, we continue to expect our cost reductions to outpace those of the industry this year,
Despite COVID-19 control measures in China that created challenges for the global electronics supply chain, Micron’s strong execution enabled record assembly output in fiscal Q3, supporting record quarterly revenue. However, these COVID-19 control measures in China impacted our outsourced assembly and test subcontractors and led to some impact to fiscal Q3 results.
We are also driving a portfolio mix shift toward higher growth and more stable markets. Fiscal 2021’s 55 to 45 revenue split in favor of the more mature mobile, PC and consumer markets is expected to shift, by fiscal 2025, to a 38 to 62 split in favor of the higher growth data center, auto, industrial, networking and graphics markets. Several of these end markets also exhibit more stable profitability. Our fiscal Q3 new product launches and customer qualifications reflect solid execution toward this portfolio transformation.
Data center fiscal Q3 revenue grew by a double-digit percentage sequentially and well over 50% year-over-year. Data center end demand is expected to remain strong in the second half of calendar 2022, driven by robust cloud CapEx growth. Despite the strong end demand, we are seeing some enterprise OEM customers wanting to pare back their memory and storage inventory due to non-memory component shortages and macroeconomic concerns.
In fiscal Q3, we achieved client revenue growth in the mid-teens percentage range sequentially, driven by DRAM shipments and share gains in client SSD.
A number of factors have impacted consumer PC demand in various geographies. As a consequence, our forecast for calendar 2022 PC unit sales is now expected to decline by nearly 10% year-over-year from the very strong unit sales in calendar 2021. This compares to an industry and customer forecast of roughly flat calendar 2022 PC unit sales at the start of this calendar year.
Smartphone unit sales expectations have declined meaningfully for calendar 2022. We are now projecting smartphone unit volume to decline by mid-single-digits percent range year-over-year in calendar 2022, well below the industry and customer expectation earlier in the year of mid-single-digit percentage growth.
Near the end of fiscal Q3, we saw a significant reduction in near-term industry bit demand, primarily attributable to end demand weakness in consumer markets, including PC and smartphone. These consumer markets have been impacted by the weakness in consumer spending in China, the Russia-Ukraine war, and rising inflation around the world.
COVID-19 control measures in China have exacerbated supply chain challenges for some customers, and the macroeconomic environment is also creating some caution amongst certain customers. Several customers, primarily in PC and smartphone, are adjusting their inventories, and we expect these adjustments to take place mostly in the second half of calendar 2022.
Fiscal Q3 NAND revenue was $2.3 billion, representing 26% of Micron’s total revenue. NAND revenue increased 17% sequentially and was up 26% year-over-year. Sequential bit shipments increased in the high-teens percent, and ASPs declined slightly.
We achieved record SSD revenue, with both data center and client SSD revenues reaching all-time highs.
Now turning to our outlook for the fiscal fourth quarter. Long-term demand trends remain constructive; however, select market weakness and macroeconomic uncertainty are impacting our near-term outlook and visibility. Currently, we do project sequential bit shipments to be down for both DRAM and NAND in fiscal Q4.
Q: Sanjay, I’m curious, do you think this Q4 outlook is the bottom of the cycle, or do you think the risks can extend into Q1? Because you mentioned that the consumer headwinds could continue to play out during the second half of the calendar year and also because cloud inventory is at elevated levels. So, I guess, my specific question as much as I realize you don’t guide out more than a quarter is, do you think Q1 sales and margins are more likely to be flat, up or down sequentially?
A: we expect these inventory adjustments to be working themselves out over the course of second half of the year. We have pointed out that the inventory adjustments primarily are taking place in PC and the smartphone market.
And I’ll just point out that from the past history as well, that once inventory adjustments begin in a certain part of the segment, then it takes a couple of quarters for them to work out. And here, we, of course, have macroeconomic uncertainties as well. It has been a rapidly changing and uncertain environment. And this is what we have to keep in mind when we look at when does normally see return in terms of demand. And that’s why, just like Mark pointed out here in response to the last question, we will be using inventory to address the demand next year. And we will continue to closely with our customers to understand their overall demand environment.
We think that sometime in fiscal ‘23 is when -- in our fiscal ‘23 is when demand will rebound, but more importantly, it’s really about the supply-demand balance. And with respect to supply-demand balance, you can see, that we are taking actions immediately in terms of curtailing our supply growth for fiscal year ‘23 by sharing the plans with you that we are bringing down our CapEx versus our estimations earlier. So, that’s an important step. And of course, industry has shown that in DRAM that it has CapEx discipline as well. We believe our actions will also contribute toward returning the industry health sooner.
So, I would expect that sometime in our fiscal year ‘23 demand will rebound as well as industry demand supply environment, there’s a store to a healthy level. But again, I will point out that, look, this is a highly uncertain rapidly changing environment. We are, of course, responding fast and -- in terms of any changes we see. So we are not been pointing to any specific quarter at this time. |
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| From: Elroy | 7/5/2022 10:43:53 PM | | | | | | | I wonder if we will still get the regular SIMO pre-announcement of revenues and gross margins? I sort of doubt it, but who knows? |
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| From: Elroy | 7/8/2022 6:29:48 PM | | | | | | | TAIPEI, Taiwan and MILPITAS, Calif., July 07, 2022 (GLOBE NEWSWIRE) -- Silicon Motion, a global leader in NAND flash controllers for solid state storage devices, announces that it will release its second quarter 2022 financial results after the market closes on July 27, 2022. The company will not be conducting its customary earnings conference call due to restrictions associated with the pending merger with MaxLinear, and thus will not be providing updates regarding the transaction or additional financial details or guidance beyond what will be made available in the earnings press release. Any further material information relevant to the transaction will be provided in subsequent press releases or public filings with the Securities and Exchange Commission. |
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| From: Elroy | 7/12/2022 10:34:18 AM | | | | | | Flash device controller production capacity loosening
digitimes.com
The supply of SSD and other NAND flash device controller chips, which are manufactured using 55nm, 40nm and 28nm process technologies at 12-inch fabs, has become less tight as foundries release more available fab capacities for such ICs, according to... |
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| To: Maurice H. Norcott who wrote (2566) | 7/12/2022 1:15:38 PM | | From: Elroy | | | | SIMO said when they gave 2022 full year revenue guidance (up 20% to 30%) that they would increase the forecast if they receive more allocation from TSMC as the year progressed.
It seems likely that they've received more allocation from TSMC. Now we gotta wonder whether their backlog has held up despite the slowdowns in cell phones and PCs, or not.
I'm hoping SIMO can produce really strong Q2 and Q3 results, and perhaps that encourages another buyer to outbid MXL. It's a bummer than SIMO management is prohibited from doing the normal investor calls and providing forward guidance due to the MXL merger agreement. But the quarterly reports don't lie, we're going to get to see the Q2 and Q3 numbers before the deal closes. I would imagine there is some revenue number for Q2 and Q3 that encourages other interested parties to bid more than MXL. Maybe!
I think the fit with MRVL is so good it's hard to believe they wouldn't bid for SIMO. MRVL could make an all stock bid well above MXL's bid, and MRVL could use a cash cow (client flash controllers) to fund the research and development in it's more advanced tech segments. Hopefully they're watching.
I can also see MediaTek perhaps step up in an effort to keep things in Taiwan. |
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| From: Elroy | 7/15/2022 8:24:09 PM | | | | | | I see that the SIMO shareholder vote on the MXL acquisition is scheduled for Aug 31st 2022.
Based on what happened with the AMD-XLNX deal at some point after that vote (assuming the deal is approved), China's SAMR approval will likely be received, and then about 2-4 days later the transaction will go through.
Does anyone have any idea on how long it might take China's SAMR to grant approval? I know there is no way to know for sure, but any opinions? Theoretically, China could grant approval before Aug 31st, and then the deal would go through the first week of September. |
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| From: Elroy | 7/17/2022 7:55:16 PM | | | | | | There's an interested timeline of the acquisition negotiations in the SIMO - MXL prospectus.......
On Feb 28 MXL bid about $110, with the acquisition being 85% cash and 15% MXL stock. MXL at the time was $74.
Goldman inquired with 5 other prospective SIMO buyers after MXL made their offer. Two responded with interest.
Later on March 2, 2022, representatives of Goldman Sachs contacted representatives
of each of the Potentially Interested Parties regarding their respective interest in engaging in discussions about potentially acquiring the Company. Representatives of two of the Potentially Interested Parties, a strategic company (“Bidder A”) and a private equity sponsor (“Bidder B”), expressed interest in further engaging in the process, while the other three Potentially Interested Parties, all of which were strategic companies, ultimately declined to explore the opportunity to potentially acquire the Company.
Both interested parties entered into confidentiality agreements with SIMO-Goldman
The first interested party bid $95 cash!
The second interested party bid $96 cash!
SIMO told the first interested party they need to pay $115-$120.
MXL upped it's bid to about $115, again 85% cash and 15% MXL stock. MXL was $69 at that time.
The first interested party increase its bid to $115 cash!
The second interested party called SIMO to say they were going to raise their bid, but after that they never called back! funny.
On March 31, 2022, representatives of Bidder B called representatives of the Company’s management team to inform them that Bidder B would try to improve the March 24 Bidder B Proposal. However, following this call, Bidder B did not again contact the Company or any of its outside advisors regarding the March 24 Bidder B Proposal or any improvements thereto.
Wow - then Party A - a strategic customer of the company (INTC? MU? SK Hynix? Samsung?) - contacted Goldman Sachs to discuss purchasing SIMO. SIMO declined to enter into acquisition discussions with a strategic customer. Idiots!!
The first interested party said it would not improve its' bid, and that its' bid could no longer be relied upon. Bastards! They think it is because regulatory issues would be a problem for the deal, and first interested party would get stuck with the a "no merger" penalty.
MXL revised its offer to $90 + 0.4532 shares of MXL per SIMO share. That was then worth $110.
Holy Crap, the first interested party sends a letter that says some other (new) private equity firm "Party B" wants to join with the first interested party to make a bid for SIMO! Goldman says hurry the fuck up!
It sounds pretty wild. There was more than four interested buyers. It is in the deal prospectus on about page 79.
They discuss regulatory issues often, and seem concerned about them. |
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