MICROCHIP TECHNOLOGY INCORPORATED (Exact Name Of Registrant As Specified In Its Charter) |
Delaware | 0-21184 | 86-0629024 |
(State or other Jurisdiction of Incorporation) | (Commission File No.) | (IRS Employer Identification No.) |
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: |
¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
23.1 | Consent of Independent Registered Public Accounting Firm |
99.1 | Unaudited pro forma combined financial statements for the fiscal year ended March 31, 2012 and as of and for the three months ended June 30, 2012 |
Dated: October 18, 2012 | Microchip Technology Incorporated |
By: /s/ J. Eric Bjornholt | |
J. Eric Bjornholt Vice President, Chief Financial Officer |
23.1 | Consent of Independent Registered Public Accounting Firm |
99.1 | Unaudited pro forma combined financial statements for the fiscal year ended March 31, 2012 and as of and for the three months ended June 30, 2012 |
/s/ PricewaterhouseCoopers LLP |
PricewaterhouseCoopers LLP |
New York, New York |
October 18, 2012 |
MICROCHIP TECHNOLOGY INCORPORATED AND SUBSIDIARIES | |||||||||||||
PRO FORMA COMBINED BALANCE SHEET | |||||||||||||
(in thousands, except share and per share amounts) | |||||||||||||
(unaudited) | |||||||||||||
ASSETS | |||||||||||||
Microchip | SMSC | Total | Pro Forma | ||||||||||
June 30, | May 31, | Pro Forma | June 30, | ||||||||||
2012 | 2012 | Adjustments | 2012 | ||||||||||
Cash and cash equivalents | $ | 779,848 | $ | 161,824 | $ | (312,701 | ) | (a) | $ | 628,971 | |||
Short-term investments | 881,913 | - | - | 881,913 | |||||||||
Accounts receivable, net | 174,685 | 60,399 | - | 235,084 | |||||||||
Inventories | 221,481 | 37,623 | 50,000 | (b) | 309,104 | ||||||||
Prepaid expenses | 25,588 | - | - | 25,588 | |||||||||
Deferred tax assets | 94,968 | 19,610 | 4,000 | (c) | 118,578 | ||||||||
Other current assets | 50,815 | 9,496 | - | 60,311 | |||||||||
Total current assets | 2,229,298 | 288,952 | (258,701 | ) | 2,259,549 | ||||||||
Property, plant and equipment, net | 506,229 | 62,063 | - | 568,292 | |||||||||
Long-term investments | 159,476 | 27,647 | - | 187,123 | |||||||||
Goodwill | 102,193 | 113,050 | 31,042 | (d) | 246,285 | ||||||||
Intangible assets, net | 110,257 | 27,960 | 490,840 | (e) | 629,057 | ||||||||
Other assets | 37,387 | 11,790 | - | 49,177 | |||||||||
Total assets | $ | 3,144,840 | $ | 531,462 | $ | 263,181 | $ | 3,939,483 | |||||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||||||||
Accounts payable | $ | 52,646 | $ | 21,354 | $ | - | $ | 74,000 | |||||
Accrued liabilities | 86,550 | 79,209 | (26,982 | ) | (f) | 138,777 | |||||||
Deferred income on shipments to distributors | 110,793 | 18,659 | (18,659 | ) | (g) | 110,793 | |||||||
Total current liabilities | 249,989 | 119,222 | (45,641 | ) | 323,570 | ||||||||
Junior convertible debentures | 357,355 | - | - | 357,355 | |||||||||
Long-term income tax payable | 73,261 | - | 58,622 | (c) | 131,883 | ||||||||
Deferred tax liability | 416,980 | - | 35,000 | (c) | 451,980 | ||||||||
Line of credit | - | - | 600,000 | (a) | 600,000 | ||||||||
Other long-term liabilities | 29,265 | 20,540 | - | 49,805 | |||||||||
Stockholders' equity: | |||||||||||||
Preferred stock | - | - | - | - | |||||||||
Common stock | 194 | 2,898 | (2,898 | ) | (h) | 194 | |||||||
Additional paid-in capital | 1,269,607 | 399,833 | (392,933 | ) | (h) | 1,276,507 | |||||||
Retained earnings | 1,510,326 | 120,790 | (120,790 | ) | (h) | 1,510,326 | |||||||
Accumulated other comprehensive income (loss) | 2,963 | 1,585 | (1,585 | ) | (h) | 2,963 | |||||||
Treasury stock, at cost | (765,100 | ) | (133,406 | ) | 133,406 | (h) | (765,100 | ) | |||||
Total stockholders' equity | 2,017,990 | 391,700 | (384,800 | ) | 2,024,890 | ||||||||
Total liabilities and stockholders' equity | $ | 3,144,840 | $ | 531,462 | $ | 263,181 | $ | 3,939,483 |
MICROCHIP TECHNOLOGY INCORPORATED AND SUBSIDIARIES | |||||||||||||
PRO FORMA COMBINED STATEMENTS OF INCOME | |||||||||||||
(in thousands, except per share amounts) | |||||||||||||
(Unaudited) | |||||||||||||
Microchip Twelve Months Ended March 31, | SMSC Twelve Months Ended February 29, | Total Pro Forma Adjustments | Pro Forma Twelve Months Ended March 31, | ||||||||||
2012 | 2012 | 2012 | |||||||||||
Net sales | $ | 1,383,176 | $ | 412,104 | $ | (10,000 | ) | (a) | $ | 1,785,280 | |||
Cost of sales | 590,782 | 196,446 | 71,371 | (b) | 858,599 | ||||||||
Gross profit | 792,394 | 215,658 | (81,371 | ) | 926,681 | ||||||||
Operating expenses: | |||||||||||||
Research and development | 182,650 | 100,350 | 5,543 | (c) | 288,543 | ||||||||
Selling, general and administrative | 212,391 | 86,706 | 44,874 | (d) | 343,971 | ||||||||
Special charges | 837 | 608 | - | 1,445 | |||||||||
395,878 | 187,664 | 50,417 | 633,959 | ||||||||||
Operating income | 396,516 | 27,994 | (131,788 | ) | 292,722 | ||||||||
Losses on equity method investments | (195 | ) | - | - | (195 | ) | |||||||
Other income (expense): | |||||||||||||
Interest income | 17,992 | 301 | - | 18,293 | |||||||||
Interest expense | (34,266 | ) | (155 | ) | (12,000 | ) | (e) | (46,421 | ) | ||||
Other, net | (352 | ) | 86 | - | (266 | ) | |||||||
Income before income taxes | 379,695 | 28,226 | (143,788 | ) | 264,133 | ||||||||
Income tax provision | 42,990 | 17,564 | (19,964 | ) | (f) | 40,590 | |||||||
Net income | $ | 336,705 | $ | 10,662 | $ | (123,824 | ) | $ | 223,543 | ||||
Basic net income per common share | $ | 1.76 | $ | 1.16 | |||||||||
Diluted net income per common share | $ | 1.65 | $ | 1.09 | |||||||||
Basic common shares outstanding | 191,283 | 192,083 | |||||||||||
Diluted common shares outstanding | 203,519 | 204,319 |
MICROCHIP TECHNOLOGY INCORPORATED AND SUBSIDIARIES | |||||||||||||
PRO FORMA COMBINED STATEMENTS OF INCOME | |||||||||||||
(in thousands, except per share amounts) | |||||||||||||
(Unaudited) | |||||||||||||
Microchip Three Months Ended June 30, | SMSC Three Months Ended May 31, | Total Pro Forma Adjustments | Pro Forma Three Months Ended June 30, | ||||||||||
2012 | 2012 | 2012 | |||||||||||
Net sales | $ | 352,134 | $ | 103,078 | $ | - | $ | 455,212 | |||||
Cost of sales | 149,055 | 46,902 | 4,143 | (b) | 200,100 | ||||||||
Gross profit | 203,079 | 56,176 | (4,143 | ) | 255,112 | ||||||||
Operating expenses: | |||||||||||||
Research and development | 48,826 | 31,956 | (5,296 | ) | (c) | 75,486 | |||||||
Selling, general and administrative | 57,920 | 44,202 | (12,386 | ) | (d) | 89,736 | |||||||
Special charges | - | (794 | ) | - | (794 | ) | |||||||
106,746 | 75,364 | (17,682 | ) | 164,428 | |||||||||
Operating income | 96,333 | (19,188 | ) | 13,539 | 90,684 | ||||||||
Losses on equity method investments | (121 | ) | - | - | (121 | ) | |||||||
Other income (expense): | |||||||||||||
Interest income | 4,332 | 40 | - | 4,372 | |||||||||
Interest expense | (9,148 | ) | (28 | ) | (3,000 | ) | (e) | (12,176 | ) | ||||
Other, net | (532 | ) | (70 | ) | - | (602 | ) | ||||||
Income before income taxes | 90,864 | (19,246 | ) | 10,539 | 82,157 | ||||||||
Income tax provision | 12,154 | (2,083 | ) | 3,185 | (f) | 13,256 | |||||||
Net income | $ | 78,710 | $ | (17,163 | ) | $ | 7,354 | $ | 68,901 | ||||
Basic net income per common share | $ | 0.41 | $ | 0.35 | |||||||||
Diluted net income per common share | $ | 0.39 | $ | 0.34 | |||||||||
Basic common shares outstanding | 193,452 | 194,252 | |||||||||||
Diluted common shares outstanding | 203,700 | 204,500 |
Twelve months ended March 31, 2012 | Three months ended June 30, 2012 | |||||
(in thousands) | ||||||
Estimate of the fair value write-up of acquired inventory and its subsequent sale after the acquisition date | $ | 50,000 | $ | — | ||
Elimination of Target's historical share-based compensation expense | (661 | ) | (2,158 | ) | ||
Addition of Company's share-based compensation for converted equity awards | 2,252 | 356 | ||||
Estimated amortization of acquired intangible assets | 23,780 | 5,945 | ||||
Cost of sales on distributor revenue recognition reversal | (4,000 | ) | — | |||
Total pro forma cost of sales adjustments | $ | 71,371 | $ | 4,143 |
Twelve months ended March 31, 2012 | Three months ended June 30, 2012 | |||||
(in thousands) | ||||||
Elimination of Target's historical share-based compensation expense | $ | (2,486 | ) | $ | (7,242 | ) |
Addition of Company's share-based compensation for converted equity awards | 8,029 | 1,946 | ||||
Total pro forma research and development expense adjustments | $ | 5,543 | $ | (5,296 | ) |
Twelve months ended March 31, 2012 | Three months ended June 30, 2012 | |||||
(in thousands) | ||||||
Elimination of Target's historical share-based compensation expense | $ | (5,055 | ) | $ | (18,601 | ) |
Addition of Company's share-based compensation for converted equity awards | 10,909 | 1,360 | ||||
Estimated amortization of acquired intangible assets | 39,020 | 4,855 | ||||
Total pro forma selling, general and administrative expense adjustments | $ | 44,874 | $ | (12,386 | ) |
Assumed tax rate applied | Twelve months ended March 31, 2012 | Three months ended June 30, 2012 | |||||||
(in thousands, except tax rates) | |||||||||
Estimate of the fair value write-up of acquired inventory and its subsequent sale after the acquisition date | 25 | % | (1) | $ | (12,500 | ) | $ | — | |
Elimination of Target's historical share-based compensation expense | 25 | % | (1) | 1,263 | 4,650 | ||||
Addition of Company's share-based compensation for converted equity awards | 25 | % | (1) | (2,727 | ) | (340 | ) | ||
Deferred margin adjustment | 25 | % | (1) | (1,500 | ) | — | |||
Interest expense on line of credit | 37.5 | % | (2) | (4,500 | ) | (1,125 | ) | ||
Total pro forma cost of sales adjustments | $ | (19,964 | ) | $ | 3,185 |