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Natl. Semi, Cyrix to merge
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July 28, 1997: 6:01 p.m. ET
Chipmakers to combine in $550 million tax-free stock swap
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NEW YORK (CNNfn) - Computer chip maker National Semiconductor Corp. said Monday it agreed to buy Cyrix Corp. in a $550 million stock swap.
Under the terms of the deal, each Cyrix common share will be exchanged for .825 of a National Semiconductor common share. The deal's $550 million value is based on Friday's closing prices of both stocks.
The companies said the combination would give them the resources needed to develop chips ideally suited for entry-level personal computers, the growing field of 'Net PCs and information appliances.
Richardson, Texas-based Cyrix, along with Sunnyvale, Calif.-based Advanced Micro Devices, develop microprocessors to compete with rival Intel Corp.
The merger has already been approved by both companies' boards of directors, although it still must clear regulatory hurdles. The companies said they expect the merger to close by November.
Cyrix has also granted Santa Clara, Calif.-based National Semiconductor the option to acquire up to 19.9 percent of outstanding Cyrix shares.
"The unique combination of technologies resulting from the merger gives us all of the building blocks to provide complete system-on-a-chip solutions for sub-$500 PCs and a broad range of low-cost information appliances," said National Semiconductor Chief Executive Officer Brian Halla.
"Cyrix's family of high-performance and high-integration x86 processors will enable National to drive dramatic market growth for products such as network PCs, hand-held PCs, net browsers and other information appliances that are becoming extremely affordable."
Jay Swent, acting chief executive of Cyrix said combining National Semiconductor's technologies and high-volume manufacturing capabilities and Cyrix's MediaGX processors will enable the merged company to grow existing markets and create new ones.
"The technologies and capabilities of both companies fit like a glove," he said.
National Semiconductor shares closed off 9/16 to 33 on Monday on the New York Stock Exchange. Cyrix shares closed up 1-13/16 to 23-1/16 on the Nasdaq Stock Exchange. Cyrix climbed to 26-1/2 in after-hours trading before the stock was halted.
--Cyrus Afzali
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