EXHIBIT 99.1

UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS

The following unaudited pro forma combined balance sheet and statements of operations are presented to give effect to the acquisition of Standard Microsystems Corporation (“Target”) by Microchip Technology Incorporated (“Company”). The pro forma information was prepared based on the historical financial statements and related notes of the Company and Target (which are incorporated by reference in this document), as adjusted for the pro forma impact of applying the purchase method of accounting in accordance with Generally Accepted Accounting Principles in the United States (“US GAAP”). The pro forma adjustments are based upon available information and assumptions that the Company believes are reasonable. The allocation of the purchase price of the Target acquisition reflected in these unaudited pro forma combined financial statements has been based upon preliminary estimates of the fair value of assets acquired and liabilities assumed. The pro forma adjustments are therefore preliminary and have been prepared to illustrate the estimated effect of the acquisition.  

The unaudited pro forma combined balance sheet has been prepared to reflect the transaction as of June 30, 2012. The unaudited pro forma combined statements of operations combine the results of operations of the Company and Target for the fiscal year ended March 31, 2012 and the three months ended June 30, 2012 as if the transaction had occurred on April 1, 2011.

The unaudited pro forma combined financial statements have been prepared for illustrative purposes only and are not necessarily indicative of the consolidated financial position or results of operations in future periods or the results that actually would have been achieved had the Company and Target been a combined company during the respective periods presented. These unaudited pro forma combined financial statements should be read in conjunction with the Company’s historical consolidated financial statements and related notes included in its Form 10-K for the fiscal year ended March 31, 2012 filed on May 30, 2012 and in its Form 10-Q for the period ended June 30, 2012 filed on August 9, 2012 as well as Target’s historical consolidated financial statements and related notes included in its Form 10-K for the fiscal year ended February 29, 2012 filed on April 23, 2012 and in its Form 10-Q for the period ended May 31, 2012 filed on July 3, 2012.

The unaudited pro forma combined financial statements were prepared using the purchase method of accounting with the Company treated as the acquiring entity. Accordingly, the aggregate value of the consideration paid by the Company to complete the acquisition will be allocated to the assets acquired and liabilities assumed from Target based upon their estimated fair values on the closing date of the acquisition. As of the date of this Form 8-K/A, the Company has not completed the detailed valuations necessary to estimate the fair value of the assets acquired and the liabilities assumed from Target and the related allocations of purchase price, nor has the Company identified all adjustments necessary to conform Target’s accounting policies to the Company’s accounting policies. Additionally, a final determination of the fair value of assets acquired and liabilities assumed from Target will be based on the actual net tangible and intangible assets and liabilities of Target that existed as of the closing date. Accordingly, the pro forma purchase price adjustments presented herein are preliminary, and may not reflect any final purchase price adjustments made. These pro forma purchase price adjustments have been made solely for the purpose of providing the unaudited pro forma combined financial statements required pursuant to Item 9.01 of Form 8-K.  The Company estimated the fair value of Target’s assets and liabilities based on discussions with Target’s management, due diligence and preliminary work performed by third-party valuation specialists. As the final valuations are being performed, increases or decreases in the fair value of relevant balance sheet amounts will result in adjustments, which may result in material differences from the information presented herein.

The Company expects to incur costs and realize benefits associated with integrating the operations of the Company and Target.  The unaudited pro forma combined financial statements do not reflect the costs of any integration activities or any benefits that may result from operating efficiencies or revenue synergies.

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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

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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

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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

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NOTES TO THE UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS

Adjustments to the pro forma combined balance sheet:

(a) This pro forma adjustment reflects the pro forma amount of cash paid for the transaction, less $600.0 million financed through the Company's existing line of credit.

(b) The pro forma adjustment to inventory reflects the fair value write-up of acquired inventory at the assumed acquisition date of approximately $50.0 million.

(c) The pro forma adjustments to deferred tax assets, long-term income taxes payable and deferred tax liabilities reflect the combination of the Company and the Target and the assessment of the tax attributes and tax liability exposure of the Target as of the assumed acquisition date.

(d) The pro forma adjustments to goodwill include the reversal of the Target's May 31, 2012 historical goodwill balance of approximately $113.0 million and the addition of approximately $144.0 million of goodwill as a result of the pro forma purchase price allocation.

(e) The intangible asset pro forma adjustments includes the reversal of the Target's May 31, 2012 historical intangible assets related to prior SMSC acquisitions of approximately $28.0 million and the addition of approximately $518.8 million as a result of the pro forma purchase price allocation.

(f) The pro forma adjustment to accrued liabilities includes the elimination of the Target's historical May 31, 2012 liability for stock appreciation rights in the amount of approximately $40.5 million, based upon the issuance of equity-based awards. Also included in the pro forma adjustment to accrued liabilities is approximately $13.5 million of estimated credits to be granted to distributors on the deferred margin adjustments described in (g) below.

(g) The pro forma adjustment to deferred income on shipments to distributors reflects the approximate amount of deferred margin recognized by the Target at May 31, 2012 which the Company will not recognize subsequent to the acquisition.

(h) The pro forma adjustments to equity includes the elimination of the Target's May 31, 2012 stockholders' equity amounts less approximately $6.9 million of transaction consideration related to pre-combination services of the Target's employee unvested shares converted to the Company's shares.

Adjustments to the pro forma combined statements of income:

(a) The pro forma adjustment to net sales reflects the reversal of revenue recognition for the sell-through of inventory held by the Target's distributors as of the assumed transaction date. The cost of sales related to this adjustment is noted in adjustment (b) below.

(b) The cost of sales pro forma adjustments are as follows:

	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

(c) The research and development expense pro forma adjustments are as follows:

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	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	)

(d) The selling, general and administrative expenses pro forma adjustments are as follows:

	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	)

(e) The pro forma adjustment to interest expense relates to the interest charge on loans from the Company's existing credit facility as a result of the transaction. The interest was calculated using a 2% interest rate on $600 million of borrowings against the line of credit.

(f) The pro forma adjustments to income tax expense are as follows:

	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

(1) 25% is the assumed tax rate of the Target's ongoing business activities.

(2) 37.5% is the assumed combined U.S. federal and state tax rate of the Target.

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