Infineon Technologies Ag · XETR:IFX
Infineon Technologies — Merger or Acquisition (September 2019)
26 slides from Infineon Technologies's merger presentation, September 2019
Slide 1: Infineon and Cypress: Strengthening the link between the real and the digital world
Infineon and Cypress: Strengthening the link between the real and the digital world September 2019
Slide 2: Agenda
Agenda 1 Deal rationale and key facts 2 Acquisition accelerates Infineon's strategy execution 3 Gaining strength in high growth markets 4 Strengthening the financial base of the company 2019-09-05 Copyright © Infineon Technologies AG 2019. All rights reserved. 2
Slide 3: The deal shapes a portfolio that perfectly links the real and the digital world
The deal shapes a portfolio that perfectly links the real and the digital world Battery-powered Industrial devices IoT Consumer IoT Connectivity Drives Software Digital applications Ecosystem world Power supplies Legend SENSE = Sensors Infineon Cypress 5G Automotive COMPUTE = Microcontrollers ACTUAT
Slide 4: Infineon and Cypress: Strengthening the link between the real and the digital world
Infineon and Cypress: Strengthening the link between the real and the digital world Power system solution leader for high growth Complementary Power discretes Sensors automotive, industrial MCUs Connectivity scope Security and IoT markets Software/ecosystem › More structural growth drivers › Enlarge
Slide 5: Enlarged portfolio scope retains its strong core while making Infineon more resilient
Enlarged portfolio scope retains its strong core while making Infineon more resilient Revenue by product category Revenue by region Infineon LTM 30 June 2019 Infineon LTM 30 June 2019 US RF &Sensors 11% 14% Europe RoW 30% Embedded 16% Power 18% 70% control & ~€8bn ~€8bn connectivity 7% China/Taiwan/
Slide 6: New Infineon: ca. €10bn revenue, ca. €45bn addressable market
New Infineon ca. €10bn ca. €45bn Annual revenue Total addressable market 47 000+ 8 600+ Total Employees R&D Employees 30 000+ 8th largest Patents Semiconductor company #1 player in automotive semiconductors, power discretes and security ICs 2019-09-05 Copyright © Infineon Technologies AG 2019. All r
Slide 7: Agenda
Agenda 1 Deal rationale and key facts 2 Acquisition accelerates Infineon's strategy execution 3 Gaining strength in high growth markets 4 Strengthening the financial base of the company 2019-09-05 Copyright © Infineon Technologies AG 2019. All rights reserved. 7
Slide 8: Strengthen and grow our core: from great products to solving the system challenge
Strengthen and grow our core: from providing great products to solving the system challenge Business areas Core Adjacent New area Home Appliances Automotive, Industrial Battery Powered Markets Differentiating competencies Systems Security Robotics Power-Systems: IoT Drives, Home Appliances Smart Hom
Slide 9: Combination creates a strong system solution provider by expanding Infineon's scope
Combination creates a strong system solution provider by expanding Infineon’s scope Example System Solution – Control loop for IoT Benefits of Combination Cloud › Higher BOM in core target applications › More design-wins due to MCU Wireless/Wired socket opportunities Connectivity › Cross-selling opp
Slide 10: With the acquisition of Cypress Infineon increases scale and strengthens its market position
With the acquisition of Cypress Infineon increases scale and strengthens its market position Top semiconductor companies Top automotive semiconductor suppliers Top 32-bit MCU suppliers Revenue 2018 (€bn) Market share 2018, total market = €32bn Market share 2018, total market = €8bn Total market = €4
Slide 11: Agenda
Agenda 1 Deal rationale and key facts 2 Acquisition accelerates Infineon's strategy execution 3 Gaining strength in high growth markets 4 Strengthening the financial base of the company 2019-09-05 Copyright © Infineon Technologies AG 2019. All rights reserved. 11
Slide 12: The addressed applications are in structural growth markets offering attractive growth rates
The addressed applications are in structural growth markets offering attractive growth rates… Market volume development of example applications / bill of material increase through full system offering E.g., Inverterized home appliances E.g., Cordless power tools ~250m units ~670m units ~160m units ~
Slide 13: …and Infineon can now offer full systems for them
…and Infineon can now offer full systems for them Market volume development of example applications E.g., Inverterized home appliances E.g., Cordless power tools CAGR(18-23) ~250m units CAGR(18-23) E.g., air-conditioning ~670m units ~160m units What makes system solution Software/ ~280m units Ecosys
Slide 14: Infineon experience: shrink and functional integration drive customer value
Infineon experience: shrink and functional integration drive customer value Example: motor control solution for aircon indoor fan Solution based on Solution based on Solution based on standard IPM CIPOS™ Nano iMOTION™ Smart IPM Market share*: Customer benefits of highly integrated power ICs 2017: 10
Slide 15: iMOTION Connect as a combined solution offering for the fast growing Smart Home market
iMOTION™ Connect as a combined solution offering for the fast growing Smart Home market iMOTION™ Connect Offering › Infineon iMOTION™ 2.0 solution for digital motor control › Cypress PSoC® 6 MCU and WiFi delivering high- performance compute, integrated security and robust wireless connectivity › Inf
Slide 16: NOR Flash supports growing use of MPUs in cluster/infotainment and automated driving
NOR Flash supports growing use of MPUs in cluster/infotainment and automated driving Drivers for increasing semiconductor content per car Cluster/Infotainment Automated Driving › Premium cars are Today early adopters of › Crash avoidance high-end features › ADAS › Trickling down to Tomorrow mid-rang
Slide 17: In automotive, Infineon and Cypress portfolios complement each other
In automotive, Infineon and Cypress portfolios complement each other and address entire range of applications Rounding out the MCU product portfolio Benefits of combination Creating the #1 Full coverage of all application fields within automotive auto semiconductor vendor* Body Cluster/ Chassis Powe
Slide 18: Cypress offers highly differentiated NOR-Flash & SRAM portfolio
Cypress offers highly differentiated NOR-Flash & SRAM portfolio NOR Flash market share SRAM market share Revenues CY2018 23% 31% ca. €2.0bn ca. €0.4bn 69% 77% Cypress Cypress › High gross and operating margins due to differentiating factors – NOR flash: density >4x the industry average, fast reading
Slide 19: Agenda
Agenda 1 Deal rationale and key facts 2 Acquisition accelerates Infineon's strategy execution 3 Gaining strength in high growth markets 4 Strengthening the financial base of the company 2019-09-05 Copyright © Infineon Technologies AG 2019. All rights reserved. 19
Slide 20: Financing: Important first steps already accomplished
Financing: Important first steps already accomplished STEP 1 Underwriting of full acquisition amount by 3 banks Confirmation by S&P that Infineon Group’s investment STEP 2 grade rating would be confirmed or rated down by one notch at a maximum following the acquisition of Cypress Equity financing of
Slide 21: Expected cost synergies of ca. €180m p.a. by 2022; revenue synergy potential >€1.5bn p.a.
Expected cost synergies of ca. €180m p.a. by 2022 Revenue synergy potential >€1.5bn p.a. long-term Planned ramp up of cost synergies Planned ramp up of revenue synergies ca. €180m €1.5bn G&A €1bn S&M R&D COGS CY 2020E CY 2021E CY 2022E CY 2022E CY 2025E CY 2028E (A) (B) COGS (A) Near-term revenue sy
Slide 22: Further improvement of through-cycle Target Operating Model
Further improvement of through-cycle Target Operating Model for IFX stand-alone and combined company Target for Current Target Integrated As announced at CMD 2018 Company* Revenue growth 9% 9%+ Segment result margin 17%+ 19% Investment-to-sales 15% 13% * Infineon financial performance to approach ne
Slide 23: Transformational acquisition delivers on Infineon's strategic direction and financial targets
Transformational acquisition delivers on Infineon’s strategic direction and financial targets What we said at the Capital Markets Day Cypress deal › Combined › Reinforce positioning in portfolio in high structural growth markets growth markets › Leverage strong core to › Optimized expand into adjace
Slide 24: Strengthening the link between the real and the digital world
Strengthening the link between the real and the digital world
Slide 25: Disclaimer
Disclaimer Cautionary Statement Regarding Forward-Looking Statements This communication may contain forward-looking statements based on current assumptions and forecasts made by Infineon Technologies AG (referred to as “Infineon” or the “Company”) management. Various known and unknown risks, uncerta
Slide 26: Disclaimer
Disclaimer Additional Important Information Neither this communication nor any part or copy of it may be generally transmitted into the United States or distributed, directly or indirectly, in the United States, as that term is defined in the United States Securities Act of 1933, as amended (the “Se
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