September 12, 2011

Broadcom to Acquire NetLogic Microsystems for $3.7 billion in cash


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Broadcom and NetLogic Microsystems, today announced they have entered into a definitive merger agreement. Under the agreement, NetLogic Microsystems shareholders will receive $50 per share in a transaction of approximately $3.7 billion, net of cash assumed.

The acquisition meaningfully extends Broadcom's infrastructure portfolio with a number of critical new product lines and technologies, including knowledge-based processors, multi-core embedded processors, and digital front-end processors, each of which offers industry-leading performance and capabilities. The combination enables Broadcom to deliver best-in-class, seamlessly-integrated network infrastructure platforms to its customers, reducing both their time-to-market and their development costs.

The transaction has been approved by the Broadcom and NetLogic Microsystems boards of directors and is subject to customary closing conditions, including the receipt of domestic and foreign regulatory clearances and the approval of NetLogic Microsystems' stockholders. The transaction is expected to close in the first half of 2012. Broadcom currently expects the acquisition to be accretive to earnings per share by approximately $0.10 on a non-GAAP basis in 2012.

Broadcom today also reiterated its business outlook for the third quarter of 2011. Broadcom expects revenue around the middle of the previously-guided range of $1.9 billion and $2.0 billion, GAAP product gross margins of flat to up slightly and GAAP research & development and selling, general and administrative expenses of flat to down $10 million in the third quarter of 2011. By the end of the third quarter, Broadcom also expects to have approximately $4.2 billion in cash and cash equivalents on hand, up from approximately $3.8 billion at the end of the second quarter.

Broadcom and NetLogic Microsystems will conduct a conference call with analysts and investors to discuss Broadcom's proposed acquisition of NetLogic Microsystems today at 5:00am Pacific Time (8:00am Eastern Time). Both companies will broadcast the conference call via webcast over the Internet.

To listen to the webcast, please visit the Investors section of either the Broadcom or NetLogic Microsystems. The webcast will be recorded and available for replay, within 48 hours after the event, until 10:00 p.m. Pacific Time on October 12 2011.

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