Texas Instruments (TXN) 8-K TI to acquire National Semiconductor

1

Texas Instruments to acquire

National Semiconductor

April 4, 2011

Exhibit 99.3

2

Safe Harbor Statement

This

presentation

includes

forward-looking

statements

within

the

meaning

of

Section

27A

of

the Securities Act of 1933 and Section

21E of the Securities Exchange Act of 1934.  These

forward-looking statements generally can be identified by phrases such as TI, National or

management

of

either

company

“believes,”

“expects,”

“anticipates,”

“foresees,”

“forecasts,”

“estimates”

or other words or phrases of similar import.  Similarly, statements herein that

describe the proposed transaction, including its financial impact, and other statements of

management’s beliefs, intentions or goals also are forward-looking statements.  It is

uncertain whether any of the events anticipated by the forward-looking statements will

transpire or occur, or if any of them do, what impact they will have on the results of

operations and financial condition of the combined companies or the price of TI or National

stock.  These forward-looking statements involve certain risks and uncertainties that could

cause actual results to differ materially from those indicated in such forward-looking

statements, including but not limited to:  the ability of the parties to consummate the

proposed

merger

and

the

satisfaction

of

the

conditions

precedent

to

consummation

of

the

proposed merger, including the ability to secure regulatory approvals at all or in a timely

manner; the ability of TI to successfully integrate National’s operations, product lines and

technology and realize additional opportunities for growth; the ability of TI to realize

synergies in terms of growth and cost savings; and the other risks and important factors

contained and identified in TI’s

most recent Annual Report on Form 10-K or National’s most

recent Quarterly Report on Form 10-Q, and other SEC filings of the companies, that could

cause actual results to differ materially from the forward-looking statements.

The forward-looking statements included in this presentation are made only as of the date of

this presentation.  Neither TI nor National undertakes any obligation to update the forward-

looking statements to reflect subsequent events or circumstances.

3

Transaction overview

•

Texas Instruments to acquire National Semiconductor

–

Offer price for National of $25.00 per share

–

100% cash consideration

–

Equity value of about $6.5 billion

–

Transaction to be financed through a combination of

balance sheet cash and debt

•

Expected close within 6-9 months

4

Strategic rationale

Together we’re stronger.

•

12,000 analog products to add to our current portfolio of 30,000

•

Highly skilled National analog engineering team joining TI

We can grow the combination significantly faster than the market.

•

Combined sales force 10x National’s –

more customers, more markets,

more revenue

•

Immediate cross-selling opportunities

The numbers work. 

•

Return on invested capital exceeds our cost of capital within 3 to 4 years

•

Combination increases TI’s profitability and earnings per share

We are a good fit, strategically and culturally. 

•

Complementary products

•

Common commitment to analog

•

Both value employees and ethical business practices

5

Combination results in great profitability

and EPS

Note:  Above does not include the impact of transaction-related costs or tax considerations

* NSC Dec 2009 –

Nov 2010 (F3Q10 to F2Q11)

** Includes:  TI $33M restructuring expense and $144M gain on sale; NSC: $30M restructuring expense

Post-close cost synergies identified, not included above

Revenue

Gross margin

R&D % of revenue

SG&A % of revenue

Operating profit**

Operating margin

Earnings per share

Cash flow from operations

TI+NSC

55.2%

32.1%

11.2

TI

10.9%

53.6%

$2.62

$4.51B

32.3%

%

$13.97B

$3.82B

17.9

NSC

19.3%

$1.56B

69.0%

$1.25

$0.47B

29.8%

%

$0.41B

$15.53B

11.9%

11.7%

$4.98B

$2.91

$4.23B

2010*

6

Accelerates TI’s transformation

TI Revenue, 2010

$14.0B

TI + NSC, 2010

$15.5B

Note:  NSC Dec 2009 –

Nov 2010 (F3Q10 to F2Q11)

Analog

49%

Other

19%

Baseband

11%

Wireless

8%

Analog

43%

Other

21%

Baseband

12%

Wireless

9%

Embedded

Processing

15%

Embedded

Processing

13%

Core revenue increases to 70% of total

7

TI

NSC

STM

Infineon

ADI

Maxim

NXP

Linear Tech

Others

Stronger analog position . . .

Total Analog TAM, 2010

$42B

Still plenty of room to grow

14%

3%

10%

8%

6%

5%

4%

3%

41%

8

Total Analog TAM, 2010

$42B

. . . especially stronger in catalog analog

Catalog Analog TAM, 2010

$18B

21%

Catalog

32%

2%

13%

7%

8%

Application-

Specific

6%

3%

3%

3%

2%

Intersil

STM

Richtek

Semtech

Others

TI

ADI

NSC

LTC

Maxim

ON

9

National’s industrial strength complements TI

TI Revenue, 2010

$14.0B

NSC Revenue, 2010

$1.6B

Industrial

22%

Industrial

46%

10

The numbers work

•

ROIC expected to exceed TI’s cost of capital within 3-4 years,

driven by growth

•

Accretive to GAAP EPS in first year, excluding non-recurring

transaction-related costs

11

Valuation

* Combined growth rate

National

69%

30%

27%

3.5

11.3

2.3

Linear Tech

78%

52%

61%

7.6

15.4

5.3

ADI

66%

35%

35%

11.8

14.8

4.1

Maxim

61%

26%

40%

7.6

31.2

3.3

Avg

Linear Tech, ADI,

68%

38%

42%

9.0

20.5

4.2

Maxim

National @ offer price

6.5

20.0

4.1

2010

2010

Gross

Operating

2010

3/31/2011

Margin

Margin

Growth

Market Cap

P/E (ttm)

P/S (ttm)

*

12

Summary

•

This is about growth

•

Analog portfolio, engineering team, sales force are

strengthened

•

Profitability, EPS are increased

•

Valuation is fair

•

Return on investment to exceed cost of capital assuming

accelerated National growth

13

Additional information

Additional Information and Where to Find It

National intends to file with the Securities and Exchange Commission (the “SEC”) a proxy statement in connection with

the proposed merger with TI.  The definitive proxy statement will be sent or given to the stockholders of National and will

contain important information about the proposed merger and related matters.  SECURITY HOLDERS ARE URGED TO

READ THE PROXY STATEMENT CAREFULLY WHEN IT BECOMES AVAILABLE.  The proxy statement and other

relevant materials (when they become available), and any other documents filed by National with the SEC, may be

obtained free of charge at the SEC’s website, at www.sec.gov.  In addition, security holders will be able to obtain free

copies of the proxy statement from National by contacting Investor Relations by mail at National Semiconductor

Corporation,  Mail Stop G2-397, 2900 Semiconductor Drive, P.O. Box 58090, Santa Clara, CA 95052-8090, Attn: Investor

Relations Department, or by telephone at (408) 721-5007. 

Participants in the Solicitation

National and TI and their respective directors and executive officers may be deemed to be participants in the solicitation of

proxies from National stockholders in connection with the proposed merger.  Information about TI's directors and

executive officers is set forth in TI's proxy statement for its 2011 Annual Meeting of Stockholders filed with the SEC

on March 7, 2011, and its Annual Report on Form 10-K for the year ended December 31, 2010, filed on February 25,

2011.  These documents are available free of charge at the SEC’s web site at www.sec.gov, and by mail at Texas

Instruments Incorporated, P.O. Box 660199, MS 8657, Dallas, TX 75266-0199, Attention: Investor Relations, or by going

to TI’s Investor Relations page on its corporate web site at www.ti.com.  Information about National’s directors and

executive officers is set forth in its proxy statement for its 2010 Annual Meeting of Stockholders, which was filed with the

SEC on August 11, 2010.  This document is available free of charge at the SEC’s web site at www.sec.gov, and from

National by contacting Investor Relations by telephone at (408) 721-5007, or by mail at National Semiconductor

Corporation,  Mail Stop G2-397, 2900 Semiconductor Drive, P.O. Box 58090, Santa Clara, CA 95052-8090, Attn: Investor

Relations Department, or by going to National’s Investor Relations page on its corporate web site at www.national.com. 

Additional information regarding the interests of participants in the solicitation of proxies in connection with the merger will

be included in the proxy statement that National intends to file with the SEC.