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Genesis Microchip To Acquire Sage

10/08/2001 02:00:00 AM Eastern

Genesis Microchip said it has a definitive agreement to acquire Sage, owners of the Faroudja brand, for approximately $241 million in stock.

Genesis said the combination will create "a technology leader with a strong history of innovation and a broad portfolio of products serving the fast-growing display semiconductor industry."

Under the terms of the agreement, Genesis will issue 0.571 shares for each outstanding Sage share.

Sage share and option holders will own approximately 28 percent of the combined company on a fully diluted basis.

Genesis anticipates that the combination will yield significant operational synergies and cost savings from efficiencies in purchasing, manufacturing, sales and administration.

Genesis said it would use the Sage assets to pursue complementary high-growth opportunities in the display semiconductor industry.

"The transaction significantly expands Genesis' global reach, with the combined company having significant research and development, service and support operations in Canada, the United States, India, Korea, Taiwan and China," according to a statement on the pending acquisition.

Genesis CEO Amnon Fisher said, "This acquisition allows Genesis to accelerate its growth in consumer video ICs by capitalizing on Sage's technological capabilities and the Faroudja brand name."

Five members of the current Genesis board of directors and two members of the Sage board will join to form a seven-member board.

Chandra Reddy, Sage's CEO, will join Genesis's board as vice chairman, with an active role in day-to-day management as engineering executive VP.

In conjunction with the transaction, Genesis will change its legal base of operations to the United States. The acquisition is expected to close in early 2002.

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