Tessera Technologies to Acquire Camera Module Manufacturing Assets to Accelerate Market Introduction of Next-Generation Technologies
- Tessera to Hold Conference Call before Market Open on March 2, 2012 -
SAN JOSE, Calif.--(BUSINESS WIRE)--
Tessera Technologies, Inc. (NASDAQ: TSRA) (the "Company") today
announced that its wholly-owned subsidiary, DigitalOptics CorporationTM
("DOC"), has agreed to acquire certain assets of Vista Point
Technologies, a Tier One qualified camera module manufacturing business,
from Flextronics International Ltd. (NASDAQ: FLEX) ("Flextronics").
DOC will pay approximately $23 million in cash, subject to certain
adjustments and costs at closing, for certain assets of Flextronics's
camera module business located in Zhuhai, China, along with the equity
interests of a wholly-owned foreign enterprise that will own those
assets (together, the "Zhuhai Camera Module Business"). The transaction,
which is expected to close in the third quarter, if not sooner, includes
existing customer contracts and a lease to an approximately
135,000-square-foot facility. DOC anticipates that the business will
have a capacity to manufacture approximately 50 million camera module
units per year.
"The Zhuhai Camera Module Business will allow us to drive rapid market
introduction of DOC's next-generation technology in a manner that
complements our existing collaborations with camera module makers. We
believe our approach is the best way to address the requirements of Tier
One OEM manufacturers, which require that camera modules be delivered
through dual sourcing from high-volume manufacturing facilities," said
Robert A. Young, president and chief executive officer, Tessera
Technologies, Inc.
"This transaction is a critical step in our strategy of transforming DOC
from an optical and image enhancement software and components business
into a Tier One qualified, vertically integrated supplier of
next-generation camera modules to the $9-billion market for mobile
cameras," Young continued. "In parallel, we continue to have active
discussions with multiple Tier One OEM manufacturers of mobile phones
regarding our MEMS autofocus product, and remain on track to obtain a
design win in the first half of 2012 and to begin high-volume
manufacturing in the fourth quarter of 2012," said Young. "We believe
our disruptive MEMS autofocus technology will offer a uniquely
competitive replacement for the magnetic voice coils in use today, while
enabling cameras that are thinner, faster, have more accurate lens
positioning and use far less battery power. Our goal is for DOC to
become profitable in 2013."
"These assets will enable DigitalOptics Corporation to significantly
increase sales of the imaging technologies we've acquired and developed
over the past five years. Our strategy is to combine our breakthrough
autofocus solutions with our other proprietary technologies so that DOC
will become a leading supplier of integrated camera modules in the
mobile phone market," said Bob Roohparvar, president of DigitalOptics
Corporation. "The acquisition of the Tier One qualified Zhuhai Camera
Module Business provides DOC with a world-class, cost competitive
facility that has the necessary production capabilities for DOC to
assemble camera modules in volume, and a well-trained team of engineers
and manufacturing employees."
In addition to developing technologies to enhance optical imaging —
including software that helps mobile phone cameras to correct hand
motion or to improve the autofocus functions — DOC has been developing
its capacity to oversee the high-volume manufacturing operations
required by mobile phone makers. DOC's steps in the past year have
included hiring more than a dozen executives and managers who have
experience in engineering scale-up as well as in manufacturing at
similar facilities.
"By adding this manufacturing capability, we will improve our ability to
make and sell unique mobile camera modules with differentiated
technology that can generate superior market demand," said Roohparvar.
"As we take control of this existing operation, we will have greater
ability to predictably develop and ramp new generations of products."
Under the agreement, DOC will reimburse Flextronics for certain
transaction expenses, taxes and inventory, the amounts of which will be
determined at closing. The transaction also includes an intellectual
property assignment and license agreement, and a transition services
agreement. DOC intends to offer employment to a portion of the existing
work force of the Flextronics camera module business in Zhuhai, China.
The transaction is subject to various closing conditions, including
necessary approvals from the appropriate PRC governmental authorities.
The Company's financial advisor on the transaction was GCA Savvian
Advisors LLC, and its legal advisor was Latham & Watkins LLP.
Conference Call Information
Management will hold a conference call today at 5:00 A.M. Pacific (8:00
A.M. Eastern) to discuss its proposed acquisition. To access the call in
the U.S., please dial 877-290-8631, and for international callers dial
706-643-3789 approximately 10 minutes prior to the start of the
conference call. The conference call will also be broadcast live over
the Internet and available for replay for 90 days at www.tessera.com.
In addition, a replay of the call will be available via telephone for
two business days, beginning two hours after the call. To listen to the
telephone replay in the U.S., please dial 855-859-2056 and for
international callers, dial 404-537-3406. Enter access code 56640601.
Safe Harbor Statement
This document contains forward-looking statements, which are made
pursuant to the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. Forward-looking statements involve risks
and uncertainties that could cause actual results to differ
significantly from those projected, particularly with respect to future
revenues, operating costs and profitability; manufacturing capacity;
management plans regarding the transformation of DOC into a vertically
integrated supplier of camera modules; product development, demand,
acceptance and market share; collaborations with camera module
manufacturers; DOC's ability to meet the needs of Tier One OEM
manufacturers; the characteristics, benefits, features, disruptive
qualities and potential of DOC's technologies and products, including
DOC's MEMS autofocus product; market opportunities; industry and
technology trends; projected manufacturing volumes; and DOC's ability to
manage high-volume manufacturing operations. Material factors that may
cause results to differ from the statements made include the plans or
operations relating to the Company's businesses; market or industry
conditions; the future expiration of license agreements and the
cessation of related royalty income; the failure, inability or refusal
of licensees to pay royalties; delays, setbacks or losses relating to
the Company's intellectual property or intellectual property
litigations, or any invalidation or limitation of key patents;
fluctuations in operating results due to the timing of new license
agreements and royalties, or due to legal costs; changes in patent laws,
regulation or enforcement, or other factors that might affect the
Company's ability to protect or realize the value of its intellectual
property; the risk of a decline in demand for semiconductor and camera
module products; failure by the industry to adopt technologies covered
by the Company's patents; the future expiration of the Company's
patents; the Company's ability to successfully complete and integrate
acquisitions of businesses, including the pending acquisition by DOC of
Flextronics's camera module business in Zhuhai, China; the risk of loss
of, or decreases in production orders from, customers of acquired
businesses; financial and regulatory risks associated with the
international nature of the Company's businesses; failure of the
Company's products to achieve technological feasibility or
profitability; failure to successfully commercialize the Company's
products; changes in demand for the products of the Company's customers;
limited opportunities to license technologies and sell products due to
high concentration in the markets for semiconductors and related
products and camera modules; the impact of competing technologies on the
demand for the Company's technologies and products; failure by DOC to
become a vertically integrated camera module supplier; and the reliance
on a limited number of suppliers for the components used in the
manufacture of DigitalOptics products. You are cautioned not to place
undue reliance on the forward-looking statements, which speak only as of
the date of this release. The Company's filings with the Securities and
Exchange Commission, including its Annual Report on Form 10-K for the
year ended Dec. 31, 2011, include more information about factors that
could affect the Company's financial results. The Company assumes no
obligation to update information contained in this press release.
Although this release may remain available on the Company's and
DigitalOptics Corporation's website or elsewhere, its continued
availability does not indicate that the Company is reaffirming or
confirming any of the information contained herein.
About Tessera Technologies, Inc.
Tessera Technologies, Inc. is a holding company with operating
subsidiaries in two segments: Intellectual Property and DigitalOptics.
Our Intellectual Property business generates revenue from patented
innovations through license agreements with semiconductor companies and
outsourced semiconductor assembly and test companies. Tessera, Inc.
pioneered chip-scale packaging solutions for the semiconductor industry.
Our DigitalOptics business delivers innovation in imaging and optics
with products and capabilities that enable expanded functionality in
increasingly smaller devices. Our miniaturized camera module solutions
provide cost-effective, high-quality camera features, including Micro
Electro Mechanical Systems ("MEMS")-based autofocus, extended depth of
field ("EDoF"), zoom, image enhancement and optical image stabilization.
We also offer customized micro-optic lenses from diffractive and
refractive optical elements to integrated micro-optical subassemblies.
For information call 1.408.321.6000 or go to www.tessera.com.
About DigitalOptics Corporation
DigitalOptics Corporation, a wholly owned subsidiary of Tessera
Technologies, Inc. (NASDAQ: TSRA), delivers innovation in imaging and
optics with products and capabilities that enable expanded functionality
in increasingly smaller devices. DigitalOptics Corporation's
miniaturized camera module solutions provide cost-effective,
high-quality camera features, including extended depth of field (EDoF),
zoom, image enhancement, optical image stabilization and MEMS-based
autofocus. These technologies can be applied to consumer electronic
products as well as vertical markets such as, automotive, medical and
security. The group also offers customized micro-optic lenses from
diffractive and refractive optical elements to integrated micro-optical
subassemblies. DigitalOptics Corporation is headquartered in San Jose,
California. For information call 1.408.321.6000 or go to www.doc.com.
Tessera, Tessera, Inc., the Tessera logo, DigitalOptics Corporation, and
Invensas Corporation are trademarks or registered trademarks of
affiliated companies of Tessera Technologies, Inc. in the United States
and other countries. All other company, brand and product names may be
trademarks or registered trademarks of their respective companies.
TSRA-G
DOC-G
Tessera Technologies, Inc.
Company Contact:
Michael
Anthofer, 408-321-6711
EVP and CFO
Investor Relations
Contact:
Moriah Shilton, 408-321-6713
Sr. Director,
Investor Relations
or
Media Contact:
The Abernathy
MacGregor Group
Kelly Sims, 415-926-7964
Amy Feng, 213-630-6550
Source: Tessera Technologies, Inc.
News Provided by Acquire Media
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