12 November 2015

Anadigics agrees to be acquired by GaAs Labs for $32m

Broadband wireless and wireline communications component maker Anadigics Inc of Warren, NJ, USA has agreed to be acquired by affiliates of GaAs Labs LLC for $0.35 per share through a cash tender offer (worth $32m in total), representing a premium of 38.2% on the average closing price of Anadigics' shares of common stock during the 30-day trading period ended 11 November.

Acquisition will "provide a platform to accelerate innovation and product development in support of revenue growth in our key target markets of CATV, small-cell, WiFi and optical," believes Anadigics' chairman & CEO Ron Michels. "GaAs Labs brings a wealth of RF semiconductor industry knowledge and a proven track record of success that we expect will strengthen our ability to provide our customers with a broader portfolio of innovative and valuable product offerings," he adds.

"We are thrilled to add Anadigics, an innovator of RF solutions for infrastructure and optical market applications, to our RF semiconductor portfolio," says GaAs Labs' co-founder & president John Ocampo.  "We look forward to leveraging Anadigics' products and technologies as a platform for growth in an array of exciting communications markets." 

Prior to creating GaAs Labs, Ocampo co-founded Sirenza Microdevices Inc of Broomfield, CO, USA (a diversified supplier of RF semiconductors and related components for the commercial communications, consumer and aerospace, defense & homeland security markets). After leading Sirenza through an IPO and eventual sale to RF Micro Devices Inc of Greensboro, NC in 2007, Ocampo served on RFMD's board of directors. In 2009, GaAs Labs acquired M/A-COM Technology Solutions Inc of Lowell, MA, USA (a supplier of semiconductors, components and subassemblies for use in RF, microwave and millimeter-wave applications). Subsequently, in mid-2010, M/A-COM Tech acquired Mimix Broadband Inc of Houston, TX, USA.

GaAs Labs will commence a cash tender offer to purchase all of Anadigics' issued and outstanding shares of common stock at $0.35 per share (net) to the seller in cash, without interest (less any applicable withholding taxes). The tender offer is subject to customary conditions, including the tender of at least a majority of the outstanding shares of Anadigics' common stock on a fully diluted basis and obtaining certain regulatory approvals, and is expected to close in December 2015 or January 2016, affter which will operate as a wholly owned subsidiary of GaAs Labs. The deal has been unanimously approved by Anadigics' board of directors. 

Under the terms of the agreement, Anadigics may solicit superior proposals from third parties for a 'go-shop' period of 25 calendar days through 6 December. It is not anticipated that any developments will be disclosed with regard to this process unless Anadigics' board makes a decision to pursue a potential superior proposal. The agreement provides GaAs Labs with a customary right to match a superior proposal. It also provides for certain break-up fees payable to GaAs Labs in connection with termination of the agreement under certain circumstances.

Net cash drops to $7.9m after revenue falls 20.5% in Q3

For third-quarter 2015, Anadigics has reported net sales of $12.1m, down 23.3% on $15.8m last quarter and 36% on $18.9m a year ago. Driven principally by the lower revenue, gross margin (on a non-GAAP basis) has fallen from 20.5% last quarter to 14.3% (down on 16% a year ago).

Operating expenses have been cut further, from $8.7m a year ago and $7.7m last quarter to $7.5m. Despite this, net loss was still $5.7m ($0.06 per share), level with $5.7m ($0.07 per share) a year ago but up on $4.5m ($0.05 per share) last quarter. During the quarter, net cash hence fell further, from $11.2m to $7.9m, excluding $3.8m drawn under the firm's credit facility with Silicon Valley Bank (SVB). SVB provided a waiver on the minimum earnings before interest, taxes, depreciation and amortization (EBITDA) covenant as of 3 October related to the three-month period then ended. Consequently, as of 3 October, Anadigics was in full compliance with the covenants of the SVB loan agreement.

See related items:

Anadigics' revenue falls 14.4% to $15.8m in Q2, as Mobile revenue drops 32.3%

Anadigics' revenue falls 12% in Q1 to $18.4m

Anadigics' quarterly sales rebound by 10.6% to $20.9m

Anadigics' revenue falls 19% in Q3 due to decline in legacy Mobile

Gaas Labs acquires GaN-on-Si RF power transistor maker Nitronex

Cobham divests M/A-COM Technology Solutions to GaAs Labs

Tags: Anadigics Gaas Labs

Visit: www.anadigics.com

Visit: www.gaaslabs.net