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Trident takes over NXP's DTV, STB units

Posted: 07 Oct 2009 ?? ?Print Version ?Bookmark and Share

Keywords:DTV? STB? NXP Trident deal? digital home?

Expected gains
"Success in the consumer business requires a company culture based on rapid decision making, a fast pace of innovation, and a highly competitive cost structure," stated Summers. "This proposed transaction enables Trident to achieve the economies of scale required to compete in the digital home market, while also taking advantage of our start-up culture and cost-efficient Asia-based engineering and operations. As a result, Trident will be well positioned to address a larger market, accelerate our time to break even and achieve our long-term financial objectives."

In order to drive cost-efficient innovation that is competitive with the industry's most aggressive consumer IC suppliers, Trident expects to retain a core set of technology centers of excellence in Europe and North America, while growing and leveraging the substantial engineering presence that each of NXP's Home business unit and Trident already has in Asia. Following the close of the transaction, Trident intends to continue supporting the existing customers and design wins of each company. Trident also plans to develop a converged product roadmap, leveraging the substantial IP of both companies and cost structure of Trident to provide the competitive products required for the next generation of customer designs.

"We believe the consumer IC business is a large, high-growth opportunity, best served by a company dedicated to this market with a highly efficient operating infrastructure," said Rick Clemmer, president and CEO of NXP. "This proposed combination is the ideal structure to position the considerable technology and market assets of our DTV and STB lines for growth and financial success. As the single largest shareholder in the expanded Trident, NXP can continue to take part in the significant upside opportunity for this business while achieving another major milestone in NXP's plans to focus and lead in high-performance mixed signal."

Reaffirming its long-term commitment to the digital home technology market, under the terms of the transaction, the primary shares being issued to NXP would be subject to a lock-up for two years.

Upon closing, Summers will remain the CEO of Trident and Christos Lagomichos, executive VP of NXP's home business unit, will become president. Pete Mangan will remain senior vice president and chief financial officer of Trident. In addition, after closing, NXP and Trident intend to cooperate in the development of complementary end-to-end solutions in other selected high-growth technology areas, including NXP's car entertainment and silicon tuner product lines. Trident will be fabless and will have the ability to access technology and manufacturing capacity from NXP's manufacturing facilities, as well as the partner foundries and subcontractors of both companies. As a result of the terms and conditions agreed between the parties, NXP will account for its investment in Trident under the equity method.

The Boards of Trident and NXP have unanimously approved the agreement and the transactions contemplated by the agreement. The transaction is subject to the approval of the stockholders of Trident, consultations with employee representatives in certain jurisdictions and other customary closing conditions, including regulatory approvals. The transaction is expected to close in the first calendar quarter of 2010.

Trident expects to generate $140 million to $160 million in revenue in the calendar quarter ending June 30, 2010, its first full quarter post-closing, and expects to break even on a non-GAAP operating basis as early as the end of calendar year 2010.


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