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27 September 2006


All that Jazz: Acquicor to acquire Jazz Semiconductor

Specialist in CMOS process technologies, such as high voltage CMOS, SiGe BiCMOS and RFCMOS, Jazz Semiconductor of Newport Beach, CA, USA has entered into a merger agreement with Acquicor Technology Inc. Jazz will merge with a wholly owned subsidiary of Acquicor for an all-cash transaction of approximately $260m. On completion, expected Q1/2007, Jazz will become a wholly owned subsidiary of Acquicor. However, the subsidiary will continue to operate as Jazz Semiconductor.

Founded in 2002, Jazz Semiconductor was formed on the contribution to Jazz of Newport Fab LLC by Conexant Systems Inc, and a $52m cash investment in Jazz by The Carlyle Group for a controlling interest. The Carlyle Group invested in Jazz to facilitate the company's transition from a captive manufacturing facility within Conexant to an independent semiconductor foundry. With that transition largely completed, Jazz now has over 95 customers, including Skyworks Solutions Inc, Marvell Technology Group Ltd, Texas Instruments, Freescale Semiconductor Inc, and RF Micro Devices Inc (RFMD).

RFMD has an equity interest in Jazz Semiconductor, but as a result of the merger with Acquicor expects to sell that interest for an aggregate cash consideration of approximately $24-$27m.  RFMD expects to take a non-cash GAAP charge in its second quarter to reduce the carrying value of its original investment in Jazz. Prior to the announcement of the pending Jazz/Acquicor transaction, RFMD had valued its investment in Jazz at approximately $60m.

Led by Gilbert F. Amelio, former chairman and CEO of Apple Computer Inc and former chairman and CEO of National Semiconductor Corporation, Acquicor is focused on acquiring businesses with technologies that can be positioned advantageously in the market and seeks to assist those companies in capitalizing on market opportunities. Amelio also served as the president of Rockwell Communications Systems, a semiconductor manufacturing division of Rockwell International Corporation, which was later spun-off as Conexant Systems Inc. In that capacity, he was responsible for operation of the manufacturing facility that is now operated by Jazz.

Acquicor has indicated that the merged company will continue to focus on the specialty foundry business. Jazz’s current CEO, Shu Li, will continue in that capacity after the merger, and Gilbert Amelio will continue as CEO of Acquicor.

Visit: http://www.jazzsemi.com