Intersil Holding Corporation (Nasdaq:ISIL - news), a leader in the rapidly growing integrated communications market, announced today that it has signed an agreement to acquire Bilthoven, Netherlands-based No Wires Needed B.V. for Intersil common stock. No Wires Needed is an established industry leader in wireless solutions and serves the rapidly expanding high data rate wireless local area network (WLAN) market with easy-to-use, flexible and mobile wireless connections to broadband communications in homes, small offices and throughout corporate campuses.
"Wireless local area networking demand is growing rapidly as wireless connectivity grows in offices and homes" said Greg Williams, president and CEO of Intersil. "Our strategy is to provide wireless semiconductor and software architectures and this acquisition will allow us to provide even more value to our customers by bringing them a wider portfolio of solutions that get them to market faster. I believe our industry-leading customers - companies such as Cisco, Nokia, Compaq, 3Com, Dell, Siemens, Samsung and Symbol - will welcome the new capabilities of our No Wires Needed-enriched PRISM portfolio."
Williams continued, "There is great synergy here, with their complimentary technologies helping speed our transition to high growth, higher gross margin integrated communications solutions - a transition that is already ahead of plan. Additionally, both businesses are growing well. In fact, sequential sales growth in the first quarter of calendar 2000 was 54 percent for our PRISM wireless business while No Wires Needed reported an increase of 47 percent."
No Wires Needed has complementary competencies that include its innovative, high performance access point which wirelessly connects multiple PCs, hand-helds or Internet appliances to broadband media. No Wires Needed also has excellent ARM-based medium access control (MAC) technology, with its IEEE802.11-compliant ARM-based MAC being the only one in production today. This MAC technology can support up to 54 Megabit-per-second (Mbps) data rates, ideal for emerging 5 GHz wireless standards.
Intersil is today's world leader in 11 megabit per second (Mbps), IEEE802.11-compliant wireless. "The 11 Mbps high data rate market is growing and will be a significant opportunity for years" said Williams. "Voice over Internet, high data rate web browsing and digital video are all available now with our fast PRISM II chip sets." No Wires Needed positions Intersil to take advantage of emerging future data rates of 50 Mbps and beyond for moving multi-channel voice and digital video around offices and homes. Finally, No Wires Needed brings other complementary offerings, including advanced encryption software for secure communications in multi-tenant, multi-user locations and building-to-building bridges for fixed wireless applications. "In summary, the No Wires Needed portfolio is a perfect fit and provides many pieces that complete the PRISM total solution," Williams added.
"The entire No Wires Needed team is pleased to join the Intersil PRISM team and co-develop new products that accelerate our momentum in this quickly expanding marketplace," said Hans Van der Hoek, president and CEO of No Wires Needed. "We're a synergistic fit, and our combined resources will allow customers to move quickly to take advantage of significant wireless market opportunities."
The all stock transaction has been approved by the Boards of Directors of both companies and is scheduled to close within approximately 30 days, subject to obtaining required consents from No Wires Needed shareholders and meeting other customary closing conditions. No Wires Needed shareholders will receive between 3.0 and 3.35 million shares, depending on the closing prices for Intersil shares during an agreed-upon period preceding the closing. "This transaction is expected to be neutral to our calendar year 2000 earnings before goodwill amortization" Williams commented. "We anticipate it will become accretive, on a cash earnings basis, early in 2001. That revenue should grow to $50 million, on an annualized run rate, by the fourth quarter of 2001. Our combined capabilities will accelerate growth of Intersil's other wireless products and give us great traction in these markets."
Since introducing the PRISM WLAN chip set in 1996, over 50 companies have incorporated PRISM chips in more than 100 product designs. PRISM technology is designed to comply with the IEEE's 802.11 global standard and Intersil is a founding sponsor of the Wireless Ethernet Compatibility Alliance (WECA), whose Wi-FiTM brand will ensure compatibility between various 802.11-based systems. Intersil has a continuing program to rapidly introduce better performing, more highly integrated generations of PRISM chip sets and supporting design tools.
No Wires Needed B.V., established in 1994 in Bilthoven, The Netherlands, is a leading provider of IEEE 802.11-compliant wireless LAN technology and products and was the first industry vendor to ship a secure, IEEE 802.11b wireless LAN solution. No Wires Needed's innovative AirLockTM Security Software adds transparent, enhanced security to wireless LANs. The company is a member of the Wireless LAN Alliance (WLANA) and the Wireless Ethernet Compatibility Alliance (WECA). For further information about the company and its products, please visit the No Wires Needed website: http://www.nowiresneeded.com.
Intersil uses its semiconductor expertise to enable highly integrated voice, data and video communications. Intersil's integrated communications portfolio includes PRISM® Wireless Local Area Network (WLAN) chip sets that enable mobile connectivity products for the home and office; analog and mixed-signal integrated circuits for broadband access to wireless and wired Wide Area Networks (WANs); and power management products that enable 24x7 reliability in network servers, next generation PCs and information appliances.
This press release contains information relating to forecasted results of Intersil, including certain projections and business trends, that are forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from these forward-looking statements as a result of certain risks and uncertainties. These risks and uncertainties include, but are not limited to No Wires Needed's ability to become accretive, on a cash earnings basis, in early 2001 and achieve $50 million annualized run-rate by the fourth quarter of 2001, global and market conditions as well as other risks and uncertainties detailed from time to time in Intersil's filings with the Securities Exchange Commission. These forward-looking statements are made only as of the date of this press release and Intersil undertakes no obligation to update or revise the forward-looking statements, whether as a result of new information, future events, or otherwise. Specific risk factors can be found in Intersil's filings with the Securities and Exchange Commission.