Marvell To Acquire Cavium - Quick Facts

(RTTNews) - Marvell Technology Group Ltd. (MRVL) and Cavium, Inc. (CAVM) announced a definitive agreement, under which Marvell will acquire all outstanding shares of Cavium common stock in exchange for consideration of $40.00 per share in cash and 2.1757 Marvell common shares for each Cavium share. This represents a transaction value of approximately $6 billion. Cavium shareholders are expected to own approximately 25% of the combined company on a pro forma basis. Marvell intends to fund the cash consideration with a combination of cash on hand from the combined companies and $1.75 billion in debt financing.

The transaction is expected to generate at least $150 to $175 million of annual run-rate synergies within 18 months post close and to be significantly accretive to revenue growth, margins and non-GAAP EPS.

Matt Murphy will lead the combined company, and the leadership team will have representation from both companies, including Marvell's current CFO Jean Hu, Cavium's Co-founder and Chief Operating Officer Raghib Hussain and Cavium's Vice President of IC Engineering Anil Jain. Cavium's Co-founder and CEO, Syed Ali, will continue with the combined company as a strategic advisor and will join Marvell's Board, along with two additional board members from Cavium's Board.