VIRL » Topics » Highlights

This excerpt taken from the VIRL 8-K filed Aug 18, 2009.

Highlights

  • The Offer will be made at 16.25 pence in cash for each ARC Share and represents a premium of approximately 38 per cent. to the Closing Price of 11.75 pence per ARC Share on 28 July 2009, being the last Business Day prior to the commencement of the Offer Period.
  • The Offer values the fully diluted ordinary share capital of ARC at approximately £25.2 million.
  • The ARC Directors, who have been so advised by Jefferies, consider the terms of the Offer to be fair and reasonable and intend unanimously to recommend that ARC Shareholders accept the Offer. In providing advice to the ARC Directors, Jefferies has taken into account the commercial assessments of the ARC Directors.
  • The ARC Directors who have legal or beneficial holdings of ARC Shares have given irrevocable undertakings to accept, or procure the acceptance of, the Offer in respect of such holdings totalling, in aggregate, 22,500 ARC Shares, representing approximately 0.015 per cent. of the existing issued share capital of ARC.
  • Virage Logic and Abigail (UK) have also received irrevocable undertakings from Gartmore, Legal & General, Herald IML, GAM (UK), Trustees of the GAM Exempt Fund and Aviva to accept, or procure the acceptance of, the Offer in respect of, in aggregate, 78,502,960 ARC Shares, representing approximately 50.833 per cent. of the existing issued share capital of ARC.
  • In addition, Virage Logic and Abigail (UK) have received an irrevocable undertaking from Gartmore in respect of CfDs that Gartmore holds which are referenced to 8,090,803 ARC Shares (representing approximately 5.239 per cent. of the existing issued share capital of ARC).
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  • Accordingly, Virage Logic and Abigail (UK) have received:

(A)       in aggregate, irrevocable undertakings to accept, or procure the acceptance of, the Offer in respect of 78,525,460 ARC Shares, representing approximately 50.847 per cent. of the existing issued share capital of ARC; and

(B)       an irrevocable undertaking in respect of CfDs referenced to 8,090,803 ARC Shares (representing approximately 5.239 per cent. of the existing issued share capital of ARC).

Commenting on the Offer, J. Daniel McCranie, Executive Chairman of Virage Logic, said:

"The acquisition of ARC would represent another significant milestone in the execution of our vision of establishing Virage Logic as a broad-line supplier of highly differentiated semiconductor IP to our global IDM, foundry and fabless customers. Through both our organic and inorganic growth initiatives, we have significantly expanded our portfolio of standard products.  

With approximately $24 million in revenue for the trailing twelve months ended 30 June 2009 and over 150 customers, ARC would contribute meaningful scale to our business. Furthermore, ARC would significantly expand our market opportunity to include microprocessor cores, the largest segment of the semiconductor IP market."

And Dr. Alex Shubat, President and CEO of Virage Logic, said:

"In our engagements with well over 300 existing worldwide customers, we have seen the need to provide additional IP building blocks to enable successful and timely development of large SoC products.

Our highly differentiated product portfolio comprising memory compilers, logic libraries, non-volatile memory, test and repair solutions, and high speed interfaces have set the standard for superior quality and value added features for a variety of end applications. By bringing ARC's talented team into our company, we will be complementing our existing technological and operational nucleus to provide even more comprehensive product solutions for our customers."

Commenting on the Offer, Richard Barfield, Chairman of ARC said:

"ARC has established a leading position in the provision of customisable Solution-to-Silicon IP to consumer and semiconductor companies globally.  The company has been rationalised and strengthened under its new leadership, and with its market-leading technology and outstanding worldwide customer base, ARC is well positioned for a successful future.

As Virage Logic has recognised, the combination of the technology, expertise and customer bases of ARC and Virage Logic will create substantial opportunities for the Enlarged Group and its customers. In addition, the ARC Directors believe that the Offer delivers value and certainty to ARC Shareholders.  Consequently, the ARC Directors are able to recommend the Offer unanimously to ARC Shareholders."

Cowen and Company, LLC and Arbuthnot Securities Limited are acting as joint financial advisers to Abigail (UK) and Virage Logic. Jefferies International Limited and Woodside Capital Partners are acting as joint financial advisers to ARC.

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This summary should be read in conjunction with, and is subject to, the full text of the following announcement which sets out further details of the Offer and which forms an integral part of this announcement.  The Offer will be subject to the Conditions and the further terms set out in Appendix A to the following announcement, and to the terms and conditions which will be set out in the Offer Document and, in the case of ARC Shareholders who hold their ARC Shares in certificated form, the Form of Acceptance.  Appendix B contains the sources and bases of certain information used in this summary and the following announcement.  Appendix C contains a summary of the irrevocable undertakings that Abigail (UK) and Virage Logic have received in connection with the Offer.  Appendix D contains definitions of certain expressions used in this summary and the following announcement.

Please read the Offer Document in its entirety before making a decision with respect to the Offer.  

In accordance with Rule 19.11 of the City Code, a copy of this announcement will be available free of charge, subject to certain restrictions relating to persons resident in Restricted Jurisdictions, for inspection on the following websites by no later than 12 noon on 19 August 2009:

www.viragelogic.com
www.arc.com

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