Renesas Electronics Corporation announced today that it has terminated its previously announced Memorandum of Understanding ("MOU") between Renesas Electronics and Sequans Communications SA. sequans"), pursuant to which Renesas Electronics made a tender offer for 0$7,575** to purchase all of the issued and outstanding common shares of Sequans at an ADS 3$03 in **Purchase of American Depositary (ADS) of Sequans (each ADS represents 4 American Depositary Shares**) in cash. The previously announced tender offer has also been terminated by Renesas.
Under the terms of the MOU, if Renesas receives confirmation from the Japan National Tax Administration that the completion of the restructuring set forth in the MOU will require Renesas to recognize taxable benefits and pay expenses, either Renesas or SEQUANS may terminate the MOU. Such a tax as provided for in Article 66-6 of the Law on Special Tax Measures of Japan ("Adverse Japanese Tax Ruling"). On February 15, 2024, Renesas received an unfavorable Japanese tax ruling. As a result, Renesas exercised its right to terminate the MOU, and as a result of that termination, the tender offer was also terminated.
As a result of the termination of the Memorandum of Understanding and the termination of the Tender Offer, Renesas will not purchase ordinary shares or ADSs of SEQUANS in the Tender Offer, and all Ordinary Shares and ADSs previously offered but not withdrawn will be returned immediately.
This termination will not have a significant impact on Renesas' core strategy to advance its technology into high-growth industries. Renesas continues to see significant opportunities in cellular IoT technology and intends to build on this momentum through its partnership with Sequans.
This letter constitutes formal notice of the expiration of the tender offer and that Renesas will not accept the purchase of any ordinary shares or American depositary shares of Sequans in connection with the tender offer. This communication is for informational purposes only and is neither an offer to buy nor a solicitation of an offer by Renesas Electronics.
Renesas Electronics acquires Sequans, a manufacturer of cellular IoT chips
Last August, Japanese semiconductor maker Renesas Electronics agreed to start with 2$4.9 billion acquisition of Sequans Electronics, a French manufacturer of cellular IoT chips. The transaction is expected to close in the first quarter of 2024, subject to formal approval by the French Enterprise's Collective Council, followed by local tax and regulatory approvals. This 2The $4.9 billion valuation covers all shareholder holdings**, including the U.S.**, as well as net debt.
Renesas will integrate Sequans' cellular IoT products and IP into its microcontrollers, microprocessors, analog and mixed-signal front-end products. "This acquisition will enable Renesas to immediately expand its reach into the wide-area network (WAN) market, which covers a wide range of data rates," a statement from the two companies said. It will also strengthen Renesas' already extensive portfolio of personal area (PAN) and local area network (LAN) connectivity. ”
The acquisition is the latest in a wave of acquisitions by Renesas, which also follows the acquisitions of Dialog, a U.K.-based power management and industrial IoT specialist (August 2021), Celeno, an Israeli provider of Wi-Fi chipsets and software (December 2021), and Panthronics, an Austrian manufacturer of near-field communication (NFC) chips (June 2023). Founded in 2003, Sequans focuses on cellular-based low-power wide-area network (LPWAN) solutions, specifically NB-IoT and LTE-M solutions, as well as higher power LTE-4G and 5G-based IoT hardware.
The two companies have been collaborating since 2020 to combine Renesas' embedded processors and analog front-end products with Sequans' wireless chipsets for large-scale IoT and broadband IoT applications. According to Renesas, the cellular IoT device market will grow at a rate of more than 10% per year, driven by demand for smart meters, asset tracking systems, smart homes, smart cities, connected cars, fixed wireless access networks, and mobile computing devices.
Renesas has a ** of 2 for Sequans$4.9 billion, which is 423%, which is 32. higher than the weighted average price over the past 6 and 12 months, respectively6% and 77%。Sequans will be re-registered in Germany by the end of 2024 (before the closing of the transaction) ("structurally, but not operationally") and will be subject to a vote of the ultimate shareholders. The transaction will make Sequans a privately held company whose American Depositary** (ADS) will be transferred to Renesas Electronics in accordance with German regulations and will no longer be listed on any public market.
Hidetoshi Shibata, President and CEO of Renesas Electronics, said:"We are excited to take our partnership with Sequans to the next level. Sequans is a leader in the fast-growing cellular IoT market with extensive cellular IoT network coverage. The company's technology provides Renesas with a path to provide a wide range of connectivity capabilities in IoT applications to meet changing customer needs. ”
Georges Karam, Chairman and Chief Executive Officer of Sequans, said:"We have been working closely with Renesas to meet the growing market demand from our massive IoT and broadband IoT customers. As many telecom operators around the world continue to invest in 5G infrastructure and expand the deployment of IoT applications, the combination with Renesas will present a tremendous opportunity to usher in a new era of seamless connectivity and digital mobility that will transform many industries. ”