Gennum increases offer price to acquire Tundra Semiconductor

Update on April 17, 2009:

Gennum Corporation, a designer and manufacturer of semiconductor solutions, has amended the terms to acquire all of the issued and outstanding shares of Tundra Semiconductor Corporation, a provider of semiconductor solutions and design services. Both the companies are based in Canada.

Pursuant to the amendment, Gennum has increased the aggregate purchase price for all of the Tundra shares from approximately CAD86 million ($67.85 million) to approximately CAD112 million ($92.93 million). The consideration payable by Gennum for each Tundra share will be, at the election of the holder, CAD5.81 ($4.82) in cash or 1.1679 common shares of Gennum or a combination thereof, subject to pro ration.

Based on 19,326,053 Tundra shares currently outstanding, in aggregate a total of CAD60 million ($49.78 million) in cash and 10.5 million Gennum shares will be issued to holders of Tundra shares. The Board of Directors of Tundra has unanimously approved the transaction.

After closing of the transaction and assuming the issuance of an aggregate of 10.5 million Gennum shares in consideration of its acquisition of the Tundra shares, Gennum is expected to have approximately 45.9 million Gennum shares issued and outstanding, with current Gennum shareholders owning approximately 77% and current Tundra shareholders owning approximately 23% of such issued and outstanding Gennum shares.

Announcement (March 19, 2009):

Gennum has signed a definitive agreement to acquire all of the issued and outstanding shares of Tundra for approximately CAD86 million ($67.85 million).

The purchase price payable by Gennum for each Tundra common share will be CAD4.43 ($3.49) in cash or 1.15 common shares of Gennum or a combination. Tundra currently has 19,326,053 outstanding common shares, aggregating a total of $55 million in cash and 8 million in shares of Gennum would be issued to shareholders of Tundra. The consideration price of CAD4.43 ($3.49) per share represents a 48% premium to the weighted average share price of Tundra's common shares ending March 18, 2009.

After closing of the transaction and assuming the issuance of an aggregate of 8 million Gennum shares in consideration of its acquisition of all Tundra shares, Gennum is expected to have approximately 43.4 million Gennum shares issued and outstanding, with current Gennum shareholders owning approximately 82% and current Tundra shareholders owning approximately 18% of such issued and outstanding Gennum shares.

CitiGroup Global Markets, Inc. is acting as financial advisor to Tundra. Genuity Capital Markets is acting as financial advisor to Gennum on the transaction.

The transaction is expected to close on or about June 1, 2009.

Deal Value (US$ Million) 92.93
Deal Type                Acquisition
Sub-Category             100% Acquisition
Deal Status              Announced: 2009-03-19

Deal Participants

Target (Company)   Tundra Semiconductor Corporation
Acquirer (Company) Gennum Corporation

Deal Rationale

The acquisition would add digital switch and bridge products, and functionality to Gennum. The acquisition will also strengthen and accelerate Gennum's technology and product development efforts, by significantly expanding research and development resources and combining mixed signal and digital design talent.

Related terms: acquisition, canada, manufacturer, product development, products, research and development, semiconductors, technology