The transaction will consolidate Saifun IP complementary to Spansion's MirrorBit technology, the companies said. In addition, the move enables Spansion to enter the technology licensing business. Further, it helps Spansion to expand its MirrorBit product spectrum beyond the NOR segment into new markets including NAND, DRAM and System-on-a-chip, the company said. The move will also help Spansion to expand its operating margins.

"Throughout our long-term partnership with Saifun we have been impressed with the depth of technology expertise and the ingenuity of the Saifun organization and look forward to establishing a team in Israel," said Spansion CEO and president Bertrand Cambou.

Since 2002, Spansion has been a licensee of Saifun's NROM IP, which has formed the cornerstone of Spansion's proprietary MirrorBit technology. According to Spansion, MirrorBit Technology now represents nearly 25% of the NOR Flash memory segment and generates revenues at a run rate approaching $2 billion per year.

As part of this relationship, Saifun has also provided design services to Spansion, including the development of Spansion's MirrorBit Quad and SPI product families. By combining the two companies, Spansion now can accelerate the development of its next generation product roadmap by directly leveraging over 150 MirrorBit technology and design experts and also eliminate its own licensing and royalty payments to Saifun.

Under the terms of the agreement, each Saifun shareholder will receive approximately 0.75 shares of Spansion common stock plus about $5 in cash. After the transaction, current Saifun shareholders will hold approximately 15 percent of Spansion's shares.

By: DocMemory
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