RF Micro Devices, TriQuint Semiconductor Agree To Combine In All-stock Deal

(RTTNews) - RF Micro Devices, Inc. (RFMD), a manufacturer of high-performance radio frequency solutions, and TriQuint Semiconductor, Inc. (TQNT), an RF solutions supplier and technology innovator, Monday announced a definitive merger agreement for the companies to combine in an all-stock transaction.

The new company will have combined revenue of more than $2 billion. The merger will create new growth opportunities in three large global markets - mobile devices, network infrastructure and aerospace/defense.

The transaction is intended to qualify as a tax-free reorganization. TriQuint shareholders will receive 1.675 shares of the new company and RFMD shareholders will receive 1 share of the new company for each TriQuint or RFMD share held.

At the closing of the transaction, the companies will execute a one-for-four reverse stock split resulting in around 145 million shares outstanding.

Former shareholders of RFMD and TriQuint will each own around 50 percent of the new company post-merger.

The transaction represents an implied price of $9.73 for each TriQuint share, representing a 5.4 percent premium based on the closing price of $9.23 for TriQuint on February 21.

The combination is expected to achieve at least $150 million in cost synergies, $75 million in annualized synergies exiting the first year after closing and an additional $75 million exiting the second year.

The transaction is expected to be accretive to adjusted earnings per share in the first full fiscal year following the closing of the transaction.

The new company will have a new name and shared leadership team. The boards of directors of both RFMD and TriQuint have unanimously approved the transaction. The transaction is expected to close in the second half of calendar 2014.

TriQuint CEO Ralph Quinsey will serve as non-executive Chairman, and RFMD CEO Bob Bruggeworth will serve as Chief Executive Officer of the new company.

The board of directors will be made up of ten directors, with five directors from the existing board of each company. Eight of the ten directors will be independent.

TriQuint CFO Steve Buhaly will serve as Chief Financial Officer and RFMD CFO Dean Priddy will serve as Executive Vice President of Administration.