MILPITAS, CA -- (Marketwire) -- 04/02/12 -- Sigma Designs®, Inc. (NASDAQ: SIGM), a leading provider of connected media platforms, today announced that it has been selected as the successful bidder to acquire certain assets of Trident Microsystems, Inc.'s Digital Television (DTV) Business, which includes certain products, licensed intellectual property, software, working capital assets and leased facilities, for $21 million in cash plus assumption of specified liabilities upon the closing of the transaction. The final cash purchase price remains subject to an adjustment for the closing current asset balance of the DTV Business to the extent the closing current assets differ from a target current assets.
The selection of Sigma Designs as the successful bidder follows the conclusion of the auction process for the DTV Business and is now subject to approval of the United States Bankruptcy Court for the District of Delaware (the "Bankruptcy Court") presiding over the bankruptcy proceedings of Trident Microsystems, Inc., and certain affiliated entities and other customary closing conditions. The Bankruptcy Court hearing to authorize the sale of the DTV Business to Sigma is expected to be held on April 4, 2012.
"Sigma Designs' acquisition of the DTV business assets of Trident Microsystems represents a significant step forward in our company's long term strategy of being the industry's leading provider of advanced SoC solutions for converged media platforms," said Thinh Tran, Sigma Designs' Chairman and CEO. "With this transaction, we will increase our revenue scale, expand our product offerings, and will have the ability to leverage our combined operational resources and OEM relationships across some of the largest high growth connected media delivery markets. We are focused on successfully growing the DTV Business and our existing business and believe the outcome of this transaction will provide long-term benefits to our customers, employees and shareholders."
Trident's DTV Business is a leading provider of global System-on-a-Chip (SoC) products for advanced connected digital televisions. Based on an extensive history of product innovation and foundational intellectual property, these assets are uniquely positioned to drive SmartTV growth by enabling their tier-1 OEM customers to develop next-generation devices that allow consumers to enjoy all forms of multimedia content, including both traditional broadcast television and video from emerging Internet content providers.
Sigma expects to make employment offers to approximately 300 employees of the Trident DTV Business, most of whom are engineers located in China.
The transaction is expected to close in the second calendar quarter of 2012, and generate positive non-GAAP EBITDA in the first full year of operations. The management team of Sigma Designs will be hosting a conference call to further discuss the transaction at 4:30 p.m. Eastern time on Wednesday, April 4, 2012, which follows the currently scheduled Bankruptcy Court hearing. Participants can access the event through Sigma's website at www.sigmadesigns.com/IR, through the Thomson StreetEvents Network or at www.earnings.com, Thomson's individual investor portal. An audio replay of the call will be available shortly thereafter and will remain available on-line for one week through Sigma's website www.sigmadesigns.com/IR.
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, including statements regarding anticipated benefits of Sigma's acquisition of the DTV Business from Trident Microsystems and the anticipated timing of bankruptcy related events impacting the sale process. Actual results may vary materially due to a number of factors including, but not limited to, the risk that, the acquisition by Sigma will not be completed as a result of the bankruptcy approval process, the inability to satisfy closing conditions or otherwise, the risk that Trident's DTV Business will deteriorate before the acquisition is closed as a result of Trident's bankruptcy or for other reasons; the risk that Sigma's efforts to operate the DTV Business will not be successful and that Sigma may be required to invest substantially more in the DTV Business than presently anticipated, the risks and management distraction associated with integrating a business that has significant international operations, new customers and new technology, risks that Sigma's systems and infrastructure may not be adequate to effect a rapid and orderly transition of the business and transferred employees from Trident to Sigma; risks associated with entering into a new business; technology risks; competition; the risk that the market for DTV solutions may not develop as Sigma anticipates, and risks associated with Sigma's ability to deploy and achieve market acceptance for DTV products. Additional risk factors are detailed from time to time in Sigma's SEC reports, including Sigma's annual report on Form 10-K as filed March 29, 2012. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. Sigma undertakes no obligation to publicly release or otherwise disclose the result of any revision to these forward-looking statements that may be made as a result of events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.
About Sigma Designs, Inc.
Sigma Designs, Inc. (NASDAQ: SIGM) is a world leader in connected media platforms. The company designs and builds the essential semiconductor technologies that serve as the foundation for the world's leading IPTV set-top boxes, connected media players, residential gateways, home control systems and more. For more information about Sigma Designs, please visit www.sigmadesigns.com.
Sigma Designs and the Sigma Designs logo are either registered trademarks or trademarks of Sigma Designs, Inc. and its subsidiaries in the United States and other countries. All other trademarks mentioned herein are believed to be trademarks of their respective owners.