Renesas Electronics Reaches a Definitive Agreement to Transfer Certain Assets and Shares of Subsidiaries Related to its LTE Modem Technology

TOKYO — (BUSINESS WIRE) — September 4, 2013 — Renesas Electronics Corporation (Representative Director, Chairman and CEO, Hisao Sakuta, hereafter "Renesas") and its wholly-owned subsidiary Renesas Mobile Corporation (Chief Executive Officer: Hideaki Chaki, hereafter "RMC") today announced that it decided to transfer all the shares of Renesas Mobile Europe Oy, RMC's subsidiary (hereafter "RME"), and Renesas Mobile India Private Limited, RME's subsidiary (hereafter "RMI") to Broadcom Corporation (hereafter "Broadcom") (together with certain assets related to its LTE modem technology hereafter "Transfer"), and executed a definitive agreement (hereafter "Definitive Agreement") with Broadcom to effect such transfer, upon the terms and subject to the conditions of the agreement.

1. Reason for Transfer

Renesas and RMC announced on June 27 that they would stop development activities and sales expansion of the 4th generation wireless modem developed by RME and RMI (hereafter "LTE Modem"), and work towards the termination of this business. After the announcement, Renesas and RMC had started performing the steps necessary to end these activities. During the process, however, Broadcom proposed Renesas and RMC to acquire the LTE Modem technology. Reviewing this proposal, Renesas and RMC reached a conclusion that it would be desirable for all the stakeholders to effect the Transfer to Broadcom, a prominent technology innovator and global leader in semiconductors for wired and wireless communications.

This transaction enables Renesas and RMC to quickly exit from the LTE Modem business and focus more on their core business, while enabling Broadcom to strengthen its semiconductor business for communications. Therefore, this transaction is highly expected to improve corporate values of both parties.

2. Outline of Subsidiaries Transferred

 

(1) Renesas Mobile Europe Oy

(a) Company Name   Renesas Mobile Europe Oy
(b) Headquarter   Helsinki, Finland
(c) Title, Name of Representative   Managing Director, Juha Heikki Tenhunen
(d) Business   Development of LTE Modem, etc.
(e) Capital   35 million Euro
(f) Founded   September 1, 2010
(g) Major Shareholders and

Percentage Held

  RMC (100.00%)
(h) Relationship with Renesas   Capital   RME is a wholly owned subsidiary of RMC, a wholly owned subsidiary of Renesas.
Human   Three employees of Renesas concurrently serve as Members of the Board.
  Business   Renesas provides RME with short-term loans, while a subsidiary of Renesas contract out the design and development of LTE Modem, etc. to RME.
(i) Financial Situation in the past three years
    FY2010   FY2011   FY2012
Shareholders' Equity (Millions of Euro)   36   41   47
Total Assets (Millions of Euro)   75   71   75
Shareholders' Equity per Share (Euro)   3,581   4,070   4,708
Net Revenue (Millions of Euro)   49   164   166
Operating Income (Millions of Euro)   1   7   7
Net Income (Millions of Euro)   1   5   6
Net Income per Share (Euro)   71   489   638
Dividends per Share (Euro)   0   0   0
 

(2) Renesas Mobile India Private Limited

(a) Company Name   Renesas Mobile India Private Limited
(b) Headquarter   Bangalore, India
(c) Title, Name of Representative   Managing Director, Ilkka Savimäki
(d) Business   Development of LTE Modem, etc.
(e) Capital   340 million Rupee
(f) Founded   October 13, 2010
(g) Major Shareholders and

Percentage Held

 

RME (99.9974%)
RMC (0.0026%)

(h) Relationship with Renesas   Capital   RMI is a subsidiary of RME, a wholly owned subsidiary of RMC.
Human   One employee of Renesas concurrently serves as a Member of the Board. One Member of the Board of Renesas' subsidiary concurrently serves as a Member of the Board
  Business   A sub-subsidiary of Renesas contract out the design and development of LTE Modem, etc. to RMI.
(i) Financial Situation in the past three years
    FY2010   FY2011   FY2012
Shareholders' Equity (Millions of Rupee)   365   448   545
Total Assets (Millions of Rupee)   507   549   656
Shareholders' Equity per Share (Rupee)   94   116   141
Net Revenue (Millions of Rupee)   279   900   1,005
Operating Income (Millions of Rupee)   61   212   251
Net Income (Millions of Rupee)   25   83   97
Net Income per Share (Rupee)   7   21   25
Dividends per Share (Rupee)   0   0   0

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