Leader in System Interconnect Broadens Portfolio To Include New PCI
Express(R) Products
OTTAWA, ON, April 19 /CNW Telbec/ - Tundra Semiconductor Corporation
(TSX:TUN), the leader in System Interconnect, today announced that it has
entered into a definitive agreement to acquire the assets of the Systems
Solutions Business Unit of Alliance Semiconductor Corporation ("Alliance
SSBU"). The acquisition includes intellectual property and several products
both in production and under development. Tundra also expects to hire over
fifty employees from Alliance SSBU as a result of the acquisition.
"Tundra is the leading provider of System Interconnect products
supporting standards like PCI-X and RapidIO. This acquisition broadens our
product offering by adding PCI Express, HyperTransport and PCI bridges. These
bridges are designed into systems currently in production at some of the
world's leading communications companies," said Jim Roche, President and CEO
of Tundra. "Moving forward, we will work with our customers to leverage the
design expertise and capacity of the acquired business along with our existing
technology base to develop a market-leading PCI Express product portfolio."
"The Alliance SSBU has world-class intellectual property, a history of
successful execution and excellent people," said Mel Keating, President and
CEO of Alliance Semiconductor. "Combining this with Tundra's strong business
will benefit both our customers and our employees."
Under the terms of the agreement, Tundra will pay $5.8 million USD in
cash upon closing. The acquisition is targeted to close on May 2, 2006
following the satisfaction of customary closing conditions. On closing, Tundra
will assume responsibility for the acquired products and support, which will
be available through Tundra's worldwide sales network.
"This acquisition is positive in many ways," said Norm Paquette, CFO of
Tundra. "It gives us the PCI Express roadmap that our customers have been
requesting, which strengthens our position with strategic customers. It also
expands and globalizes our R&D team as well as offers attractive financial
returns."
Tundra expects the acquired products to generate revenues of between
$1.7 and $2.0 million in the first quarter of fiscal 2007, which starts on
May 1, 2006. Thereafter, it is expected that the revenues will grow between 5%
and 10% per quarter. For the first few quarters, the acquired business will be
effectively break-even and within two to three years, it should generate after-
tax profits in line with Tundra's business model. Since the acquisition closes
outside the quarter, Tundra will not be changing its guidance for Q4 fiscal
2006.
"We've been executing on an acquisition strategy that has three key
elements - strengthening our financial position, broadening our System
Interconnect portfolio and increasing our penetration of strategic customers,"
commented Roche. "The recent acquisition of Potentia Semiconductor achieves
our objectives by strengthening our financial position, allowing us to invest
more in our System Interconnect portfolio. The Alliance SSBU acquisition
achieves our objectives by broadening our product portfolio and strengthening
our position with strategic customers."
GLOBAL EXPANSION
"Through this acquisition we expect to hire an experienced and highly
innovative design team in Hyderabad, India, and a team in Santa Clara,
California," said Benny Chang, Vice President of Engineering of Tundra. "The
unique skill and experience of this team combined with our existing
complementary technologies supports our growing global operations and
strengthens our competitive advantage."
NEW PRODUCTS
The acquired products currently sampling or in production will be named
the Tundra Tsi301(TM) HyperTransport-to-PCI Bridge (formerly the SP1011),
Tsi308(TM) HyperTransport-to-PCI-X Bridge (formerly the AS90L10208), the
Tsi350(TM) PCI Bridge (formerly the AS90L10150) and Tsi352(TM) PCI Bridge
(formerly the AS90L10152). Products under development include PCI and PCI
Express bridge products to be announced at a future date. Product and ordering
information can be found on www.tundra.com.
CONFERENCE CALL AND WEBCAST
The Company will be holding a conference call today, April 19, 2006 at
8:30AM EST to review the aforementioned transaction. Investors may access the
conference call via any of the following:
Teleconference: 416-644-3414
Replay: 416-640-1917, Pass code: 21185610(number sign). (Available up
until April 26, 2006)
Web Cast:
http://www.newswire.ca/en/webcast/viewEvent.cgi?eventID(equal sign)1419220
ABOUT TUNDRA
Tundra Semiconductor Corporation (TSX:TUN) is the global leader in System
Interconnect providing world-class support and leading edge semiconductor
solutions to the world's foremost communications, networking, storage system,
and information technology vendors. Consistently delivering on system level
performance promises that reduce time to market, Tundra System Interconnect
ensures market advantage in wireless infrastructure, storage networking,
network access, military, industrial automation, and information technology
applications. For more information, please visit www.tundra.com.
Attachments:
Tundra Product Photos & Block Diagrams:
www.tundra.com/NewsRoom/MediaResources/ImageLibrary/index.cfm
Tundra Semiconductor Products:
www.tundra.com/Products/ProductsListing.cfm
Tundra Semiconductor Webinars:
www.tundra.com/NewsRoom/Webcasts/index.cfm
Tundra Semiconductor White Papers:
www.tundra.com/whitepapers
Comment respecting any Forward Looking Statement in this release -
Tundra Semiconductor Corporation is a public company with common shares
listed for trading on the Toronto Stock Exchange (TSX:TUN) in Canada. All
figures, unless otherwise noted, are stated in Canadian dollars in accordance
with accounting principles generally accepted in Canada. The Company cautions
that the forward-looking information in this release is based on certain
assumptions made by the Company that may prove to be inaccurate. Assumptions
made include customer demand for the acquired products, the Company's ability
to maintain and enhance existing customer relationships, as well as the
Company's ability to bring to market the products currently under development.
Furthermore, the Company cautions that the forward-looking statements in this
release are based on current expectations that are subject to risks and
uncertainties. Actual results may differ due to factors such as customer
demand, customer relationships, new product development, product shipping
schedules, product mix, competitive products, pricing pressure, and changes in
the embedded systems market specifically. Additional information identifying
risks and uncertainties is contained in the Company's filings with the various
provincial securities commissions.
TUNDRA is a registered trademark of Tundra Semiconductor Corporation
(Canada, U.S. and U.K.). TUNDRA and the Tundra logo are registered marks of
Tundra Semiconductor Corporation (Canada - registration in the United States,
European Union, and People's Republic of China). Tsi350, Tsi352, Tsi301 and
Tsi308 are trademarks of Tundra Semiconductor Corporation. The PowerPC name,
Power Architecture name, and the PowerPC logotype are trademarks of
International Business Machines Corporation, used under license therefrom.
RapidIO(R) is a registered trademark of the RapidIO Trade Association. Other
registered and unregistered trademarks are the property of their respective
owners.
(C) Copyright 2006 Tundra Semiconductor Corporation. All rights reserved.
Information subject to change without notice.
