Exhibit 99.1
============
SMSC ACQUIRES OASIS SILICONSYSTEMS
Adds Blue-Chip Automotive Customer Base for Infotainment Networking
Applications & Broadens European Presence
Hauppauge, NY - March 30, 2005 - Reaching a significant milestone in its
diversification strategy, SMSC (Nasdaq: SMSC), a leading semiconductor company
delivering innovative system solutions spanning analog, digital and mixed-signal
technologies, today announced the acquisition of OASIS SiliconSystems Holding AG
(OASIS), a leader in the development and marketing of integrated circuits that
enable networking of multimedia devices for automotive infotainment
applications. OASIS is a leading provider of Media Oriented Systems Transport
(MOST(R)) technology, which enables the seamless transport of digital audio,
video, and packet-based data, along with control information, within
automobiles.
Headquartered in Karlsruhe, Germany, and supported by an IC engineering team in
Austin, Texas, OASIS is one of the largest privately held fabless semiconductor
companies in Europe and currently serves a top tier customer base of leading
automakers and automotive suppliers. OASIS's infotainment networking technology
has been widely adopted by many European luxury to mid-sized car brands,
including Audi, BMW, Fiat, Jaguar, Land Rover, Mercedes-Benz, Porsche, PSA, Saab
and Volvo.
This acquisition allows SMSC to achieve a greater balance among its
application-focused businesses. The service model employed by OASIS with
automotive customers dovetails with SMSC's expertise in servicing markets that
require optimized solutions for networking information. This natural fit not
only enhances growth opportunities with automotive infotainment customers in
Europe and Asia, but also brings strong systems design capabilities that SMSC
can leverage in the consumer electronics and industrial markets.
Net of cash acquired in the transaction, SMSC acquired OASIS for $94 million,
with 62% of the consideration paid in cash and the balance in shares of SMSC
common stock. The transaction closed on March 30, 2005. Additional payments of
cash and SMSC common stock aggregating up to $20 million may occur in fiscal
2007 upon achievement of certain performance goals. Also, as an inducement to
entering into employment, stock option grants covering an aggregate of 1.1
million shares, all having exercise prices of the closing price per share on
March 30, 2005, and approximately 75,000 shares of restricted stock were issued
to 149 individuals at OASIS who will be employed in positions ranging from Clerk
to Vice President.
In calendar 2004, OASIS's revenues were $50 million and it was profitable.
Double-digit growth in revenues and earnings are expected in calendar 2005 for
OASIS. Before amortization of acquired intangibles and in-process R&D charges,
the transaction is expected to be neutral to SMSC's earnings in the first
quarter of fiscal 2006 and slightly accretive for the balance of that fiscal
year.
"The acquisition of OASIS marks another major step in SMSC's diversification
strategy by moving into a new vertical market with the leader in automotive
infotainment networking in Europe," said Steven J. Bilodeau, Chairman, President
and Chief Executive Officer of SMSC. "This acquisition enables the Company to
strengthen its business with broader product lines, accelerates overall revenue
growth and provides for greater leverage to SG&A. Furthermore, it provides
geographic diversity and increases brand visibility by establishing SMSC as an
important semiconductor provider in Europe. With a now well balanced business,
we are able to leverage our technology solutions across automotive, computing,
consumer electronics and industrial markets, which will further increase
long-term returns to shareholders."
"SMSC's strong business infrastructure will provide access to greater resources
and an outstanding supply chain for OASIS's existing customer base, enabling us
to provide them an even higher level of service and support," said Herbert
Hetzel, Chief Executive Officer of OASIS. "Through the combination of these
resources and our systems expertise in infotainment networking, we will also
open the door to new opportunities with prospective customers as infotainment
applications are increasingly integrated into the automotive platform. We look
forward to contributing to SMSC's successful business expansion and becoming
part of an even larger leading semiconductor organization."
OASIS is the exclusive supplier to nearly every major European automaker for
MOST-based semiconductor solutions for vehicle infotainment systems. It is also
a founding member of the MOST Cooperation, a cooperative of automakers,
automotive systems architects and manufacturers and key components suppliers
working to establish and refine a common standard for the evolving requirements
of automotive multimedia networking. SMSC will actively support the advancement
of MOST as a standard for networking and connectivity in the global automotive
and consumer electronics industries.
A conference call to discuss SMSC's acquisition of OASIS SiliconSystems will be
held tomorrow, March 31 at 9:00 AM Eastern Standard Time, or 4:00 PM Central
European Summer Time. Access information for the live call is as follows: (800)
810-0924; Passcode: 6103764. A replay will also be available on SMSC's website,
www.smsc.com, following the live event.
About SMSC:
Many of the world's most successful global technology companies rely upon SMSC
as a go-to resource for semiconductor system solutions that span analog, digital
and mixed-signal technologies. Leveraging substantial intellectual property,
integration expertise and a comprehensive global infrastructure, SMSC solves
design challenges and delivers performance, space, cost and time-to-market
advantages to its customers. SMSC's application focus targets high-growth
vertical markets including mobile and desktop PCs, servers, consumer
electronics, automotive infotainment and industrial applications. The Company
has developed leadership positions in its select markets by providing
application specific solutions such as mixed-signal PC system controllers,
non-PCI Ethernet, ARCNET, MOST, USB2.0 and other high-speed serial
communications.
SMSC is based in Hauppauge, New York with operations in North America, Taiwan,
Japan, Korea, China and Europe. Engineering design centers are located in
Arizona, New York, Texas and Karlsruhe, Germany. Additional information is
available at www.smsc.com.
Forward Looking Statements:
Except for historical information contained herein, the matters discussed in
this announcement are forward-looking statements about expected future events
and financial and operating results that involve risks and uncertainties. These
include the timely development and market acceptance of new products; the impact
of competitive products and pricing; the effect of changing economic conditions
in domestic and international markets; changes in customer order patterns,
including loss of key customers or distributors, order cancellations or reduced
bookings; and excess or obsolete inventory and variations in inventory
valuation, among others. Such statements are qualified in their entirety by the
inherent risks and uncertainties surrounding future expectations and may not
reflect the potential impact of any future acquisitions, mergers or
divestitures.
SMSC competes in the semiconductor industry, which has historically been
characterized by intense competition, rapid technological change, cyclical
market patterns, price erosion and periods of mismatched supply and demand. In
addition, sales of many of the Company's products depend largely on sales of
personal computers and peripheral devices, as well as general industry and
market conditions. Reductions in the rate of growth of the PC, consumer
electronics, embedded or automotive markets could adversely affect its operating
results. SMSC conducts business outside the United States and is subject to
tariff and import regulations and currency fluctuations, which may have an
effect on its business. All forward-looking statements speak only as of the date
hereof and are based upon the information available to SMSC at this time. Such
information is subject to change, and the Company may not necessarily inform, or
be required to inform, investors of such changes. These and other risks and
uncertainties, including potential liability resulting from pending or future
litigation, are detailed from time to time in the Company's reports filed with
the SEC. Investors are advised to read the Company's Annual Report on Form 10-K
and quarterly reports on Form 10-Q filed with the Securities and Exchange
Commission, particularly those sections entitled "Other Factors That May Affect
Future Operating Results" for a more complete discussion of these and other
risks and uncertainties.
SMSC is a registered trademark of Standard Microsystems Corporation. Product
names and company names are trademarks of their respective holders.
Contact:
Carolynne Borders
Director of Corporate Communications
SMSC
Voice: 631-435-6626
Fax: 631-273-5550
carolynne.borders@smsc.com