TI to Acquire Power Trends
Acquisition Strengthens TI's Position in Catalog Analog Semiconductors
Dallas (October 4, 1999) - Texas Instruments (NYSE: TXN) today said it plans to acquire Power Trends, a leading supplier in the emerging and fast-growing market for point-of-use power solutions situated next to digital signal processors, microprocessors and other high performance devices on the circuit board. This acquisition strengthens TI's catalog analog portfolio, in particular TI's power management products. Combining Power Trends' system and design understanding of point-of-use power-solutions with TI's advanced analog silicon technologies will enable complete, easy-to-use modular solutions and speed customers' time-to-market.
The acquisition is being made through a stock-for-stock transaction. Based on TI's closing stock price on Oct. 1, 1999, the company expects to issue about 1.68 million shares worth approximately $145 million in exchange for all outstanding shares of Power Trends. "The growing complexity of power management systems creates real design challenges for our customers," said Dan Reynolds, TI vice president for advanced analog products. "Customers increasingly find it easier and more cost-effective to buy a pre-designed and tested plug-in power supply instead of developing their own new power management skills and engineering teams. This frees up their designers to focus on system features that add greater value to their products."
Plug-in power-supplies are a rapidly growing trend in power management, as high-performance integrated circuits become increasingly complex, requiring higher current at lower voltages. To achieve these performance levels requires that power management move from traditional centralized power supplies to point-of-use power regulation located on individual circuit boards close to the device being powered. TI expects demand for plug-in power products to grow to $1 billion within five years.
"We see the trend to plug-in power supplies as a critical component in offering customers easy-to-use solutions," Reynolds said. "Power Trends' leading-edge technology in their new Excalibur™ series is a great example of how this can help customers. This gives us both a growth opportunity and another way to help our customers bring their products to market faster."
Power Trends is a privately held company located in Warrenville, Ill. The company also has design and manufacturing facilities in Warrenville. Power Trends serves hundreds of customers worldwide including Cisco, IBM and Hewlett-Packard. Key markets for power module systems include data communications, computer systems and industrial segments. Power Trends has approximately 230 employees.
"We think this is a great opportunity to leverage ourselves with the world's leading analog integrated circuit manufacturer," said Russ Ashdown, president and CEO of Power Trends. "By combining our power integration skills with TI's leading analog silicon technology, we can reach more customers with total power management solutions, that offer even greater performance and ease-of-design."
The acquisition of Power Trends follows plans announced in July to acquire Unitrode Corporation. Both acquisitions are part of TI's strategy to expand and build its leadership in catalog analog semiconductors for power management.
Power Trends will become a wholly owned subsidiary of TI reporting into TI's worldwide analog business and will continue to operate from its Warrenville headquarters. The boards of directors of both companies have approved the acquisition, which is expected to be completed by the end of this year. The transaction is intended to qualify as a pooling of interests for accounting purposes and as a tax-free exchange of shares under IRS regulations.
Completion of the acquisition is contingent upon approval by Power Trends stockholders, the expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act and other customary conditions.
The acquisition is expected to be slightly accretive to TI earnings.
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NOTE TO EDITORS: Texas Instruments Incorporated is a global semiconductor company and the world's leading designer and supplier of digital signal processing and analog technologies, the engines driving the digitization of electronics. Headquartered in Dallas, Texas, the company's businesses also include materials and controls, education technology, and digital imaging. The company has manufacturing or sales operations in more than 25 countries.
Texas Instruments is traded on the New York Stock Exchange under the symbol TXN. More information is located on the World Wide Web at http://www.ti.com.
Power Trends designs and manufactures a full line of Integrated Switching Regulators and DC to DC Converters developed from a unique high-frequency design that has won national recognition for the Company as a power supply innovator. Power Trends' products are sold through a worldwide network of sales representatives and distributors.
More information on Power Trends' products is on the World Wide Web at www.powertrends.com.