Numonyx to Be Acquired by Micron

Micron has announced that it is acquiring the innovative memory architectures and technologies of Numonyx Holdings B.V. This move will strengthen the company's position as a top-tier supplier of NAND, DRAM and NOR memory products, especially considering that Micron sees a great potential for Numonyx's portfolio to give it a more stable foothold in the DRAM, NOR and NAND memory chip spaces. The all-stock transaction will have Micron issuing a number of common shares to Numonyx shareholders.

After an initial 140 million Micron common shares, Numonyx shareholders Intel Corp., STMicroelectronics and Francisco Partners will also ratably receive up to 10 million extra Micron common shares for the next 20 trading days. These shares will be valued at between $7.00 and $9.00 per share, with the total transaction estimated at being the equivalent of $1.27 billion. In exchange for these shares, Micron will acquire access to Numonyx's technology, including the phase-change memory for which it is best known. In addition, Micron will get the memory developer's customer base.

"Acquiring Numonyx brings together two memory leaders and positions Micron to offer the most comprehensive, cost-competitive solutions in the industry to a broad range of customers and end-markets," said Micron chairman and chief executive officer Steve Appleton.

Numonyx's balance sheet is expected to be debt-free upon closing the deal. The company entered the pact because it believed that its technologies and Micron's are highly compatible. The merger will lead to the appearance of a memory-focused company ranking among the largest in the world. In addition, Micron believes that the transaction will be accretive (it will increase its earnings per share), starting with fiscal 2011, on both free-cash flow and non-GAAP earnings.

“We believe the opportunity for Numonyx to join with Micron will deliver a clear advantage for our customers and our employees,” stated Brian Harrison, President and CEO of Numonyx. “This announcement is a strong testimony to the value of Numonyx technologies, products and people. The result will be a strong company that can best serve our target market segments and customers by delivering enhanced memory solutions, strength and scale. It is good for Numonyx and good for Micron.”

The deal is expected to close within three to six months, during which time it will be subjected to customary closing conditions and regulatory review.