SiTime to be Acquired by MegaChips for $200M

Largest acquisition of a venture-backed semiconductor company in 2014
MegaChips becomes a leader in MEMS with SiTime’s 80% share in MEMS timing
MegaChips’ revenue of $600M provides scale and growth for MEMS

SUNNYVALE, Calif. — (BUSINESS WIRE) — October 28, 2014 — SiTime Corporation, a MEMS and analog semiconductor company, today announced that it has signed a definitive agreement under which MegaChips Corporation (Tokyo Stock Exchange: 6875), a top 25 fabless semiconductor company based in Japan, will acquire SiTime for $200 million in cash. This transaction combines two complementary fabless semiconductor leaders that provide solutions for the growing Wearables, Mobile and Internet of Things markets.

“SiTime’s founders, Markus Lutz and Dr. Aaron Partridge, started the company with a vision of developing game-changing MEMS and analog technology to revolutionize the $5 billion timing industry,” said Rajesh Vashist, CEO of SiTime. “Through innovation, passion and focus, we’ve successfully delivered on this vision. Today, SiTime is the overwhelming leader – we have 1000 customers, 250 million units shipped, major design wins in all electronics segments, and a roadmap that extends SiTime’s MEMS technology to all timing markets.”

“Every SiTime employee is excited to be part of MegaChips as we share a common entrepreneurial culture,” continued Vashist. “MegaChips’ financial strength and scale, with SiTime’s innovation and passion, will rapidly accelerate the adoption of MEMS timing solutions.”

While the world of electronics has delivered many innovations, the clock function, which is the heartbeat in all electronics, still uses 75-year-old quartz technology. SiTime’s innovative MEMS timing solutions replace dated quartz products in the telecom, networking, computing, storage and consumer markets, with the benefits of higher performance, smaller size, and lower power and cost.

“MegaChips has an aggressive growth strategy with a vision to become one of the top ten fabless semiconductor companies through both organic growth and strategic acquisitions,” said Akira Takata, President and CEO of MegaChips Corporation. “MEMS components are fuelling the growth of the semiconductor industry. Through the acquisition of SiTime, MegaChips becomes a leader in MEMS. SiTime will help us expand our portfolio and diversify our customer base. SiTime technology is the perfect match for MegaChips’ solutions that target Wearables, Mobile and IoT markets such as “frizz”, our ultra-low-power smart phone Sensor Hub LSI and BlueChip Wireless, a sub-GHz RF LSI.”

“As a founding investor in SiTime, Bosch recognized early on the tremendous vision and innovation behind SiTime’s approach to MEMS timing,” said Dr. Volkmar Denner, Chairman, Board of Management of Robert Bosch GmbH. “We have closely followed their success from a Silicon Valley startup to a revenue-generating company that sells to some of the world’s largest electronics companies. We are pleased that MegaChips is acquiring SiTime and we expect a bright future for the combined companies.”

“We are delighted by this merger. MegaChips and SiTime are very complementary companies with similar innovative and entrepreneurial cultures, and a unified vision that can transform the electronics industry," said Joe Horowitz, Managing General Partner at Jafco Ventures and a SiTime Board Member. “By leveraging SiTime's proprietary technologies and highly differentiated products, I have no doubt this combination is just at its opening act with a great future ahead."

“Over the past ten years, SiTime has built an extraordinary technology platform and a family of products that is in high demand at leading customers,” said Brooke Seawell, a Venture Partner at New Enterprise Associates and a founding investor and Board Member at SiTime. “With MegaChips’ operational and global scale, SiTime’s future is bright. The combined company will accelerate the adoption of MEMS timing solutions and will become a leading supplier to the electronics industry.”

Upon closing, scheduled for November 2014 pending regulatory approvals and customary closing conditions, SiTime will retain its name and operate as a wholly owned subsidiary of MegaChips. During this transaction, Needham & Company, LLC served as the exclusive financial advisor to SiTime.

MegaChips Corporation (1st section of the TSE (Tokyo Stock Exchange): 6875) was established in 1990 as an innovative fabless company dedicated to ASICs and system LSIs with the goal of integrating LSIs and systems knowledge and solutions. Its focus is on the development of cutting-edge system LSIs and systems products incorporating original algorithms and architecture in the areas of imaging, audio, and telecommunications, and using the advances it achieves to offer outstanding products and solutions that meet the needs of its clients. For additional information, please visit: http://www.megachips.co.jp/english/index.html.

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