Teradyne expands reach to flash test with $325M Nextest buy
By Ann Steffora Mutschler, Senior Editor -- EDN, December 12, 2007
To capture market share in the fast-growing flash memory test segment, estimated to be more than $700 million in 2006, San Jose-based SoC test provider Teradyne Inc. said today it will acquire flash memory and SoCs automatic test equipment supplier, Nextest Systems Corp., for approximately $325 million.
Of Nextest's $95.8 million in revenue in calendar year 2006, flash memory tester sales totaled about $80 million, the company noted.
Under terms of the agreement, unanimously approved by both boards of directors, Teradyne is to pay $20 per share in cash for all the outstanding shares of Nextest with the aggregate purchase price expected to be approximately $325 million, net of the cash acquired and including the fair value of fully vested employee equity instruments and transaction costs.
The acquisition is expected to be slightly dilutive to Teradyne’s 2008 GAAP earnings per share and slightly accretive to 2008 non-GAAP earnings per share after excluding the purchase accounting impacts.
Robin Adler, CEO of Nextest said the acquisition will accelerate the Nextest’s mission to lower test costs and to grow the business.
Michael Bradley, president and CEO of Teradyne added in a statement, “Nextest brings us a solid flash memory test product line, plus a very capable development and technical support organization. Their growing presence in the flash memory test market provides a strong addition to our system-on-chip product offerings. This is one of the few business combinations in the test market where customers get products that are so complementary. Nextest’s Magnum product line will be backed by Teradyne’s global customer support team and will give us a powerful growth engine in the coming years.”
The companies expect the acquisition to close in Q1 2008, after which Nextest will be run as a business unit within Teradyne’s semiconductor test division.
For commentary on this aquisition from EDN sister publication Test & Measurement World, please click here.
