Dialog Semiconductor Plc.: Recommended Cash Offer for Dialog Semiconductor Plc by Renesas Electronics Corporation

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF SUCH JURISDICTION

LONDON, UK / ACCESSWIRE / February 8, 2021 / to be effected by means of a scheme of arrangement

under Part 26 of the Companies Act 2006

Summary

• The boards of Renesas Electronics Corporation ("Renesas") and Dialog Semiconductor Plc ("Dialog") are pleased to announce that they have reached agreement on the terms of a recommended all cash offer to be made by Renesas for the entire issued and to be issued share capital of Dialog (the "Acquisition").
• Under the terms of the Acquisition, each Dialog Shareholder will be entitled to receive:

€67.50 in cash for each Dialog Share

• The Acquisition values the entire issued and to be issued share capital of Dialog at approximately €4,886 million.
• The price of €67.50 in cash per Dialog Share represents a premium of approximately:
• 20.3 per cent. to the Closing Price of €56.12 for each Dialog Share on 5 February 2021 (being the Latest Practicable Date);
• 51.7 per cent. to the daily volume weighted average price of €44.50 for each Dialog Share for the three month period ended 5 February 2021 (being the Latest Practicable Date); and
• 61.5 per cent. to the daily volume weighted average price of €41.79 for each Dialog Share for the six month period ended 5 February 2021 (being the Latest Practicable Date).
• The Acquisition represents a compelling opportunity for all Dialog Shareholders to realise their full investment in cash at a substantial upfront premium to the daily volume weighted average price of the Dialog Shares for the three month and six month periods ended 5 February 2021 (being the Latest Practicable Date).
• The Dialog Directors, who have been so advised by J.P. Morgan Cazenove and Qatalyst Partners as to the financial terms of the Acquisition, consider the terms of the Acquisition to be fair and reasonable. In providing their financial advice to the Dialog Directors, each of J.P. Morgan Cazenove and Qatalyst Partners have taken into account the commercial assessments of the Dialog Directors. J.P. Morgan Cazenove and Qatalyst Partners are providing independent financial advice to the Dialog Directors for the purposes of Rule 3 of the Takeover Code.
• Accordingly, the Dialog Directors intend to recommend unanimously that Dialog Shareholders vote in favour of the Scheme at the Court Meeting and the resolutions relating to the Acquisition to be proposed at the Dialog General Meeting, as the Dialog Directors who hold interests in Dialog Shares have irrevocably undertaken to do in respect of their own beneficial holdings of 599,327 Dialog Shares (representing, in aggregate, approximately 0.841 per cent. of the Dialog Shares in issue on 5 February 2021, being the Latest Practicable Date). Full details of the irrevocable undertakings received by Renesas are set out in Appendix 3 to this Announcement.
• It is intended that the Acquisition be implemented by way of a Court-sanctioned scheme of arrangement under Part 26 of the Companies Act (or, if Renesas so elects, subject to the terms of the Co-operation Agreement and with the consent of the Takeover Panel, a Takeover Offer). The purpose of the Scheme is to provide for Renesas to become the owner of the entire issued and to be issued ordinary share capital of Dialog. The Scheme will be put to Dialog Shareholders at the Court Meeting and at the Dialog General Meeting. In order to become effective, the Scheme must be approved by a majority in number of the Dialog Shareholders voting at the Court Meeting, either in person or by proxy, representing not less than 75 per cent. in value of the Scheme Shares voted. In addition, the implementation of the Scheme must also be approved by Dialog Shareholders at the Dialog General Meeting.
• The Acquisition is subject to the Conditions and certain further terms set out in Appendix 1 including the approval of Dialog Shareholders and the receipt of certain anti-trust and foreign investment clearances, including in Germany, the People's Republic of China, Taiwan and the United States.
• The Scheme Document will include the full terms and conditions of the Acquisition, together with notices of the Court Meeting and Dialog General Meeting, the expected timetable of the Acquisition and will specify the action to be taken by Dialog Shareholders. It is expected that the Scheme Document will be published within 28 days of this Announcement (or on such later date as may be agreed by the Takeover Panel).
• The Acquisition is currently expected to become Effective in the second half of 2021, subject to the satisfaction or waiver of the Conditions and certain further terms set out in Appendix 1 and to the full terms and conditions of the Acquisition which will be set out in the Scheme Document. An expected timetable of principal events will be included in the Scheme Document.
• Renesas is a multi-national corporation headquartered in Tokyo, Japan and is listed on the Tokyo Stock Exchange and is a component of the JPX Nikkei Index 400. Renesas delivers trusted embedded design innovation with complete semiconductor solutions that enable billions of connected, intelligent devices to enhance the way people work and live - securely and safely. A provider of microcontroller units (MCUs), analog, power, and system-on-chip (SoC) products, Renesas provides the expertise, quality, and comprehensive solutions for a broad range of Automotive, Industrial, Home Electronics (HE), Office Automation (OA) and Information Communication Technology (ICT) applications to help shape a limitless future.
• Dialog is an innovative provider of integrated circuits (ICs) that power mobile devices, consumer Internet of Things (IoT) and Industry 4.0. Dialog's technologies include battery and power management, AC/DC power conversion, custom mixed-signal ICs, Bluetooth low energy ICs and low-power Wi-Fi, and non-volatile flash memory. Dialog's solutions are integral to some of today's leading mobile devices and the enabling element for increasing performance and productivity on the go. From making smartphones more power efficient and shortening charging times, enabling home appliances to be controlled from anywhere to connecting the next generation of wearable devices, Dialog's decades of experience and world-class innovation help manufacturers get to what's next.

Commenting on the Acquisition, Dr. Jalal Bagherli, CEO of Dialog, said:

"For several years, we have successfully executed on a diversification strategy that positions Dialog for high growth. We have built a strong foundation of high-performance analog and power efficient mixed-signal expertise, extended our product portfolio and applied our technologies into markets including 5G, wearables, automotive, smart home, connected medical and industrial IoT. This compelling platform - combined with Renesas' embedded compute, analog and power portfolio - creates even greater growth opportunities in today's increasingly connected world. The Dialog team is excited to join forces with Renesas. The combined company will be in an even stronger position to provide innovative products for these markets, building on Renesas' extensive sales, distribution and customer support capabilities."

Commenting on the Acquisition, Hidetoshi Shibata, President and CEO of Renesas, said:

"The transaction we announced today represents our next important step in catapulting Renesas' growth plan to achieve substantial strategic and financial benefits, following our previous acquisitions. Dialog has a strong culture of innovation along with excellent customer relationships and serves fast growing areas including IoT, industrial and automotive. By bringing Dialog's talented team and expertise into Renesas, together, we will accelerate innovation for customers and create sustainable value for our shareholders."

This summary should be read in conjunction with, and is subject to, the full text of the following Announcement and its appendices. In particular, the Acquisition will be subject to the Conditions and further terms set out in Appendix 1 to this Announcement and to the full terms and conditions which will be set out in the Scheme Document. Appendix 2 details the sources of financial information and bases of calculation used in the Announcement. Appendix 3 contains information in respect of the irrevocable undertakings. Appendix 4 sets out the definitions of certain terms used in the Announcement.

Enquiries:

Covington & Burling LLP is acting as legal adviser to Renesas and Linklaters LLP is acting as legal adviser to Dialog.

Important Notice

Nomura International plc ("Nomura"), which is authorised by the Prudential Regulation Authority and regulated by Prudential Regulation Authority and the Financial Conduct Authority in the United Kingdom, is acting as financial adviser exclusively to Renesas and no one else in connection with the Acquisition and this Announcement and Nomura, its affiliates and its respective officers, employees, agents, representatives and/or associates will not regard any other person as their client, nor will they be responsible to anyone other than Renesas for providing the protections afforded to clients of Nomura nor for providing advice in relation to the matters in the Acquisition, this Announcement or any matter referred to herein. Neither Nomura nor any of its subsidiaries, branches or affiliates owes or accepts any duty, liability or responsibility whatsoever (whether direct or indirect, whether in contract, in tort, under statute or otherwise) to any person who is not a client of Nomura in connection with the Acquisition, this Announcement or any matter referred to herein.

J.P. Morgan Securities plc, which conducts its UK investment banking business as J.P. Morgan Cazenove, ("J.P. Morgan Cazenove") and which is authorised in the United Kingdom by the Prudential Regulation Authority and regulated in the United Kingdom by the Prudential Regulation Authority and the Financial Conduct Authority, is acting exclusively as financial adviser to Dialog and no one else in connection with the matters set out in this Announcement and will not regard any other person as its client in relation to the Acquisition and shall not be responsible to anyone other than Dialog for providing the protections afforded to clients of J.P. Morgan Cazenove nor for providing advice in connection with the Acquisition or any matter referred to herein.

Qatalyst Partners Limited ("Qatalyst Partners"), which is authorised in the United Kingdom by the Financial Conduct Authority, is acting exclusively as financial adviser to Dialog and no one else in connection with the matters set out in this Announcement and will not regard any other person as its client in relation to the Acquisition and shall not be responsible to anyone other than Dialog for providing the protections afforded to clients of Qatalyst Partners or for providing advice in connection with the Acquisition or any matter referred to herein.

Further information

The Announcement is made pursuant to Rule 2.7 of the Takeover Code and is provided for information purposes only. It is not intended to, and does not constitute, nor form part of, an offer, invitation or the solicitation of an offer to purchase, otherwise acquire, subscribe for, exchange, sell or otherwise dispose of, any securities, or the solicitation of any vote or approval in any jurisdiction pursuant to the Acquisition or otherwise nor will there be any sale, issuance, exchange or transfer of securities of Renesas or Dialog in any jurisdiction in contravention of applicable law.

The Acquisition will be made solely pursuant to the terms of the Scheme Document which will contain the full terms and conditions of the Acquisition, including details of how Dialog Shareholders may vote in respect of the Acquisition. Any decision in respect of the Scheme or the Acquisition by Dialog Shareholders should be made only on the basis of the information contained in the Scheme Document. Dialog Shareholders are advised to read the Scheme Document carefully once these become available because they will contain important information in relation to the Acquisition and the Combined Group. The Scheme Document will be posted to Dialog Shareholders within 28 days of the date of this Announcement unless Renesas and Dialog agree otherwise, and the Takeover Panel consents, to a later date.

This Announcement does not constitute a prospectus or prospectus exempted document.

If you are in any doubt about the contents of this Announcement, or the action you should take, you are recommended to seek your own independent financial advice immediately from your stockbroker, bank manager, solicitor, accountant or other independent financial adviser duly authorised under the Financial Services and Markets Act 2000 (as amended) if you are resident in the United Kingdom or, if not, from another appropriately authorised independent financial adviser.

Restricted Jurisdictions

The release, publication or distribution of this Announcement in jurisdictions other than the United Kingdom, Germany or Japan may be restricted by the laws and regulations of those jurisdictions and therefore any persons who are not resident in the United Kingdom, Germany or Japan should inform themselves about, and observe, any such restrictions. Any failure to comply with such restrictions may constitute a violation of the securities laws of any such jurisdiction. In particular, the ability of persons who are not resident in the United Kingdom, Germany or Japan to participate in the Acquisition may be affected by the laws of the relevant jurisdictions in which they are located. To the fullest extent permitted by applicable law, the companies and other persons involved in the Acquisition disclaim any responsibility or liability for any violation of such restrictions by any person.

This Announcement has been prepared for the purposes of complying with applicable English law and will be subject to the applicable requirements of the Takeover Code and the Takeover Panel. The information disclosed may not be the same as that which would have been disclosed if this announcement had been prepared in accordance with the laws of jurisdictions outside England and Wales.

Unless otherwise determined by Renesas or required by the Takeover Code, and permitted by applicable law and regulation, the Acquisition will not be made available, directly or indirectly, in, into or from a Restricted Jurisdiction, if to do so would constitute a violation of that jurisdiction. Accordingly, copies of this Announcement and any formal documentation relating to the Acquisition are not being, and must not be, directly or indirectly, mailed, transmitted or otherwise forwarded, distributed or sent in, into or from a Restricted Jurisdiction, where to do so would violate the laws in that jurisdiction, and persons receiving this Announcement and all documents relating to the Acquisition (including custodians, nominees and trustees) must not mail or otherwise distribute or send them in, into or from Restricted Jurisdictions, where to do so would violate the laws and regulations in that jurisdiction.

Further details in relation to Dialog Shareholders who are resident in, ordinarily resident in, or citizens of, jurisdictions outside the United Kingdom, Germany or Japan will be contained in the Scheme Document.

Additional information for US investors in Dialog

The Acquisition relates to shares of a company incorporated under the laws of England and Wales and is being made by means of a scheme of arrangement provided for under Part 26 of the Companies Act. A transaction effected by means of a scheme of arrangement is not subject to the tender offer rules or the proxy solicitation rules under the US Exchange Act. This Announcement does not constitute an offer to sell or the solicitation of an offer to buy any securities. If, in the future, Renesas exercises the right to implement the Acquisition by way of a Takeover Offer and determines to extend the offer into the United States, such offer will be made in compliance with applicable US laws and regulations, including any applicable exemptions under the US Exchange Act. Financial information included in this Announcement and the Scheme Documentation has been or will have been prepared in accordance with accounting standards applicable in the United Kingdom that may not be comparable to financial information of US companies or companies whose financial statements are prepared in accordance with US GAAP.

The receipt of consideration by a US holder for the transfer of its Dialog Shares pursuant to the Scheme may be a taxable transaction for US federal income tax purposes and under applicable US state and local, as well as foreign and other, tax laws. Each Dialog Shareholder is urged to consult his or her independent professional adviser immediately regarding the tax consequences of the Acquisition applicable to him or her.

It may be difficult for US holders of Dialog Shares to enforce their rights and any claim arising out of the US federal laws, since Renesas and Dialog are located primarily in a non-US jurisdiction, and some or all of their officers and directors may be residents of a non-US jurisdiction. US holders of Dialog Shares may not be able to sue a non-US company or its officers or directors in a non-US court for violations of the US securities laws. Further, it may be difficult to compel a non-US company and its affiliates to subject themselves to the jurisdiction and judgment of a US court.

Neither the U.S. Securities and Exchange Commission nor any securities commission of any state of the United States has reviewed, approved or disapproved this Announcement or Acquisition, nor have such authorities passed upon or determined the fairness of the Acquisition or the adequacy or accuracy of the information contained in this Announcement. Any representation to the contrary is a criminal offence in the United States.

Cautionary note regarding forward-looking statements

The Announcement may contain certain statements that are, or may be deemed to be, forward-looking statements with respect to the financial condition, results of operations and business of Dialog and/or Renesas and/or the Combined Group and certain plans and objectives of Dialog and/or Renesas and/or the Combined Group with respect thereto. These forward-looking statements can be identified by the fact that they do not relate to historical or current facts. Forward-looking statements also often use words such as 'anticipate', 'target', 'continue', 'estimate', 'expect', ''forecast', 'intend', 'may', 'plan', 'goal', 'believe', 'hope', 'aims', 'continue', 'could', 'project', 'should', 'will' or other words of similar meaning. These statements are based on assumptions and assessments made by Dialog and/or Renesas (as applicable) in light of their experience and perception of historical trends, current conditions, future developments and other factors they believe appropriate. By their nature, forward-looking statements involve risk and uncertainty, because they relate to events and depend on circumstances that will occur in the future and the factors described in the context of such forward-looking statements in this Announcement could cause actual results and developments to differ materially from those expressed in or implied by such forward-looking statements. Although it is believed that the expectations reflected in such forward-looking statements are reasonable, no assurance can be given that such expectations will provide to be correct and you are therefore cautioned not to place undue reliance on these forward-looking statements which speak only as at the date of this Announcement.

Forward-looking statements are not guarantees of future performance. Such forward-looking statements involve known and unknown risks and uncertainties that could significantly affect expected results and are based on certain key assumptions. Many factors could cause actual results to differ materially from those projected or implied in any forward-looking statements. Due to such uncertainties and risks, readers are cautioned not to place undue reliance on such forward-looking statements, which speak only as of the date of this Announcement. Neither Dialog nor Renesas undertakes any obligation to update or revise any forward-looking statement as a result of new information, future events or otherwise, except as required by the Takeover Panel, the Takeover Code or by applicable law.

There are several factors which could cause actual results to differ materially from those expressed or implied in forward-looking statements. Among the factors that could cause actual results to differ materially from those described in the forward-looking statements are changes in the global, political, economic, business and competitive environments, market and regulatory forces, future exchange and interest rates, changes in tax rates and future business combinations or dispositions. If any one or more of these risks or uncertainties materialises or if any one or more of the assumptions prove incorrect, actual results may differ materially from those expected, estimated or projected. Such forward looking statements should therefore be construed in the light of such factors.

No member of the Renesas Group or the Dialog Group nor any of their respective associates, directors, officers, employers or advisers, provides any representation, assurance or guarantee that the occurrence of the events expressed or implied in any forward-looking statements in this Announcement will actually occur.

Except as expressly provided in this Announcement, no forward-looking or other statements have been reviewed by the auditors of the Renesas Group or the Dialog Group. All subsequent oral or written forward-looking statements attributable to any member of the Renesas Group or the Dialog Group, or any of their respective associates, directors, officers, employers or advisers, are expressly qualified in their entirety by the cautionary statement above.

No profit forecasts, quantified financial benefit statements or estimates

Unless expressly stated otherwise, no statement in this Announcement (including any statement of estimated synergies) is intended, or is to be construed, as a profit forecast, profit estimate or quantified financial benefit statement for any period.

Disclosure of share interests and dealings

Under Rule 8.3(a) of the Takeover Code, any person who is interested in 1 per cent. or more of any class of relevant securities of an offeree company or of any securities exchange offeror (being any offeror other than an offeror in respect of which it has been announced that its offer is, or is likely to be, solely in cash) must make an Opening Position Disclosure following the commencement of the offer period and, if later, following the announcement in which any securities exchange offeror is first identified.

An Opening Position Disclosure must contain details of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any securities exchange offeror(s). An Opening Position Disclosure by a person to whom Rule 8.3(a) applies must be made by no later than 3.30 p.m. (London time) on the 10th Business Day following the commencement of the offer period or the announcement in which any securities exchange offeror is first identified. If a person required to make an Opening Position Disclosure under Rule 8.3(a) deals in the relevant securities of the offeree company or of a securities exchange offeror before midnight on the day before the Opening Position Disclosure deadline, he must instead make a Dealing Disclosure.

Under Rule 8.3(b) of the Takeover Code, any person who is, or becomes, interested in 1 per cent. or more of any class of relevant securities of the offeree company or of any securities exchange offeror must make a Dealing Disclosure if the person deals in any relevant securities of the offeree company or of any securities exchange offeror during an offer period. A Dealing Disclosure must contain details of the dealing concerned and of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (a) the offeree company and (b) any securities exchange offeror, save to the extent that these details have previously been disclosed under Rule 8. A Dealing Disclosure by a person to whom Rule 8.3(b) applies must be made by no later than 3.30 p.m. (London time) on the business day following the date of the relevant dealing.

A Dealing Disclosure must contain details of the dealing concerned and of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of: (i) the offeree company; and (ii) any securities exchange offeror, save to the extent that these details have previously been disclosed under Rule 8 of the Takeover Code. A Dealing Disclosure by a person to whom Rule 8.3(b) applies must be made by no later than 3.30 p.m. (London time) on the business day following the date of the relevant dealing.

If two or more persons act together pursuant to an agreement or understanding, whether formal or informal, to acquire or control an interest in relevant securities of an offeree company or a securities exchange offeror, they will be deemed to be a single person for the purpose of Rule 8.3 of the Takeover Code.

Opening Position Disclosures must be made by the offeree company and also by any offeror and Dealing Disclosures must also be made by the offeree company, by any offeror and by any persons acting in concert with any of them (see Rules 8.1, 8.2 and 8.4 of the Takeover Code).

Details of the offeree and offeror companies in respect of whose relevant securities Opening Position Disclosures and Dealing Disclosures must be made can be found in the Disclosure Table on the Takeover Panel's website at www.thetakeoverpanel.org.uk, including details of the number of relevant securities in issue, when the offer period commenced and when any offeror was first identified. If you are in any doubt as to whether you are required to make an Opening Position Disclosure or a Dealing Disclosure, you should contact the Takeover Panel's Market Surveillance Unit on +44 (0)20 7638 0129.

Electronic communications

Please be aware that addresses, electronic addresses and certain other information provided by Dialog Shareholders, persons with information rights and other relevant persons in connection with the receipt of communications from Dialog may be provided to Renesas during the offer Period as required under Section 4 of Appendix 4 of the Takeover Code to comply with Rule 2.11 of the Takeover Code.

Publication on websites

This Announcement and the other documents required to be published pursuant to Rule 26.1 of the Takeover Code will be made available free of charge, subject to certain restrictions relating to persons resident in Restricted Jurisdictions, on Renesas' website at https://www.renesas.com/us/en/about/investor-relations/offer-for-dialog and on Dialog's website at www.dialog-semiconductor.com/acquisition by no later than 12 noon (London time) on the next Business Day following date of this Announcement, up to and including the end of the Acquisition. For the avoidance of doubt, the contents of these websites are not incorporated into and do not form part of this Announcement.

Availability of hard copies of this Announcement

In accordance with Rule 30.3 of the Takeover Code, a person so entitled may request a hard copy of this Announcement by contacting FTI Consulting by email to [email protected] or on + 44 203 727 1000 or by submitting a request in writing Dialog Semiconductor Plc, c/o FTI Consulting, 200 Aldersgate, Aldersgate Street, London, EC1A 4HD. Dialog Shareholders may also request that all future documents, announcements and information to be sent to them in relation to the Acquisition should be in hard copy form. If you have received this Announcement in electronic form, copies of this Announcement and any document or information required to be incorporated by reference into this Announcement will not be provided unless such a request is made.

Number of Dialog shares in issue

In accordance with Rule 2.9 of the Takeover Code, Dialog confirms that, as of today's date, it has in issue 71,268,687 ordinary shares of £0.10 each (excluding Dialog Shares held in treasury). The International Securities Identification Number (ISIN) of Dialog's ordinary shares which are admitted to trading on the Frankfurt Stock Exchange is GB0059822006.

Time

All times shown in this Announcement are London times, unless otherwise stated.

Rounding

Certain figures included in this Announcement have been subjected to rounding adjustments. Accordingly, figures shown for the same category presented in different tables may vary slightly and figures shown as totals in certain tables may not be an arithmetic aggregation of the figures that precede them.

Availability of the full form of this Announcement

This is a summary of a longer Announcement. The full form of this Announcement, which includes certain defined terms used herein, will be available on Dialog's website at www.dialog-semiconductor.com/acquisition shortly.

Contact:
Jose Cano
Director, Investor Relations
[email protected]
+44(0)1793756961

SOURCE: Dialog Semiconductor Plc.