Cypress, Spansion To Merge In $4 Bln All-Stock Deal

(RTTNews) - Cypress Semiconductor Corp. (CY) and Spansion, Inc. (CODE) said Monday that they have signed a definitive agreement to merge in an all-stock, tax-free deal valued at about $4 billion.

Under the deal, Spansion shareholders will receive 2.457 Cypress shares for each Spansion share they own. The shareholders of each company will own about 50% of the post-merger company. The company will have an eight-person board of directors consisting of four Cypress directors, including T.J. Rodgers and Eric Benhamou, and four Spansion directors, including John Kispert and Ray Bingham, the Spansion chairman, who will serve as the non-executive chairman of the combined company, which will be headquartered in San Jose, California and called Cypress Semiconductor Corp.

Cypress and Spansion expect the deal to close in the first half of 2015.

The post-merger company will generate more than $2 billion in revenue annually and create a global provider of microcontrollers and specialized memories needed in embedded systems.

The merger is expected to achieve more than $135 million in cost synergies on an annualized basis within three years and to be accretive to adjusted earnings within the first full year after the deal closes.

The combined company will continue to pay $0.11 per share in quarterly dividends to shareholders.