News | March 30, 1999

Cypress Close To Acquiring IC WORKS

Cypress Semiconductor Corp. announced that its acquisition of IC WORKS, Inc. (ICW) is nearing completion and is targeted to close on or about April 1, 1999.

Cypress and ICW have so far satisfied the following conditions for closing:

  • The Federal Trade Commission granted early termination of the Hart-Scott-Rodino waiting period on Feb. 8, 1999;
  • The California Department of Corporations granted a fairness opinion March 15, 1999, for the issuance of up to 13.7 million Cypress shares to acquire ICW; and
  • As of March 28, 1999, Cypress has received at least a 90% affirmative vote from ICW stockholders to approve the deal.

Cypress intends to account for the acquisition as a pooling of interests. Receipt of an opinion of Cypress's accountants concurring with Cypress's management opinion that no conditions exist related to Cypress that would preclude Cypress from accounting for the acquisition as a pooling of interests is a further condition to closing.

As previously disclosed in Cypress's filings with the Securities and Exchange Commission, the sale of certain shares previously repurchased by the Company pursuant to its stock repurchase program is necessary in order for the acquisition to be accounted for as a pooling of interests. Consistent with the pooling objective, the Board of Directors of Cypress cancelled its stock repurchase program in February 1999.

Cypress President and CEO T.J. Rodgers said, "We are glad to see this merger nearing completion and we are doing everything possible to close the transaction this quarter. For the first quarter of 1999, the analysts expect revenue of approximately $135 million and earnings of $0.07 from Cypress. We remain comfortable with this earnings estimate.

"Given the closing of the ICW merger in the quarter, the combined companies' performance could be in the revenue range of $148-153 million and an earnings range of $0.08-$0.09, excluding non-recurring transaction-related costs. For the fiscal year 1999, the merger of ICW with Cypress is expected to increase Cypress's revenue by more than $70 million and after giving effect to the sale of previously repurchased shares to enable the acquisition to be accounted for as pooling of interests, is still expected to be accretive to Cypress's earnings."

Rodgers continued, "IC WORKS makes precision timing generators (clocks) for PC motherboards, audio/visual synchronization and DSP memory synchronization using CMOS and BiCMOS technologies. Cypress makes a wide variety of general-purpose clocks using EPROM technology. Our products are highly complementary, and our combined resources will represent the largest clock business in the world with annual revenue of about $150 million."

Cypress will announce earnings for its first quarter 1999 on Tuesday, April 20, at 8:30 a.m. Pacific Time.