MagnaChip Semiconductor Announces Definitive Agreement To Sell Foundry Business and Fab 4
Under the terms of the Agreement, the total transaction value is approximately
MagnaChip's Chief Executive Officer, YJ Kim, said: "This is an excellent outcome for all our stakeholders, including customers, employees and investors. Importantly, it will allow us to meaningfully improve our balance sheet, and fully focus as a pure-play standard products company on the attractive high-growth opportunities in our Display Solutions and Power Solutions business lines. We look forward to building upon our leadership position in the OLED display driver business and are excited about the emerging MicroLED space. Our Power products portfolio, including
Under the terms of the Agreement, the SPC will acquire the Target Business. Alchemist and Credian serve as joint general partners of a project fund that established the SPC, while its limited partners consist of SK hynix Inc., one of the largest semiconductor companies in the world, and
"After conducting a thorough strategic evaluation process of the Foundry business and Fab 4, the Board of Directors and management team concluded that this transaction was the best option to maximize value for our shareholders," said
"Following the completion of this sale, MagnaChip will be streamlined operationally, largely freed of interest expense and we believe will be ideally positioned for continued future success."
MagnaChip is the largest independent supplier of organic light emitting diodes (OLED) display driver integrated circuits (DDICs) to the world's top two panel manufacturers for smartphones. The Company's large portfolio of OLED DDICs includes multiple 28-nanometer display drivers with the industry's lowest power, a key requirement for smartphones, including upcoming 5G and foldable models. The Company's Power Solutions business is a leading provider of standard products, including battery field effect transistors (FETS) to increase power efficiency in smartphone batteries, as well as premium products such as super junction metal oxide semiconductor field effect transistors (MOSFETs), insulated-gate bipolar transistors (IGBTs) and power integrated circuits for consumer, TV, communications and industrial applications. The Company will continue to operate its Power Discrete 8" fab (Fab 3, located in Gumi,
The transaction is expected to close within approximately four to six months, subject to customary closing conditions.
MagnaChip to Host a Conference Call on
The conference call will be webcast live on
MagnaChip is a designer and manufacturer of analog and mixed-signal semiconductor platform solutions for communications, IoT, consumer, industrial and automotive applications. The Company's
Safe Harbor for Forward-Looking Statements
Information in this release regarding the Company's forecasts, business outlook, expectations and beliefs are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that involve risks and uncertainties. All forward-looking statements included in this release are based upon information available to the Company as of the date of this release, which may change, and we assume no obligation to update any such forward-looking statements. These statements are not guarantees of future performance and actual results could differ materially from our current expectations. A number of important factors could cause actual results to differ materially from those indicated in such forward-looking statements. These factors include, but are not limited to, (i) the risk that the transaction may not be completed in a timely manner or at all, (ii) the possibility that any or all of the various conditions to the consummation of the transaction may not be satisfied or waived, (iii) the occurrence of any event, change or circumstance that could give rise to the termination of the Agreement, (iv) the effect of the announcement or pendency of the transaction on the Company's ability to retain and hire key personnel, its ability to maintain relationships with its customers, suppliers and others with whom it does business, or its operating results and business generally, (v) the risk that revenues following the transaction may be lower than expected, (vi) the risk that operating costs, customer loss, and business disruption (including, without limitation, difficulties in maintaining relationships with employees, customers, and suppliers) may be greater than expected, (vii) the assumption of unexpected risks and liabilities, (viii) the outcome of any legal proceedings that may be instituted related to the Agreement or the transaction, (ix) the diversion of and attention of management of the Company on transaction-related issues, and (x) other risks detailed from time to time in the Company's filings with the
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