Analog Devices and Linear Technology to Combine Creating the Premier Analog Technology Company

Following the transaction close, Mr. Roche, President and CEO of Analog Devices will continue to serve as President and CEO of the combined company, and David Zinsner, SVP and CFO of Analog Devices, will continue to serve as SVP and CFO of the combined company. Analog Devices and Linear Technology anticipate a combined company leadership team with strong representation from both companies across all functions. The Linear Technology brand will continue to serve as the brand for Analog Devices’ power management offerings. The combined company will use the name Analog Devices, Inc. and continue to trade on the NASDAQ under the symbol ADI.

Transaction Structure and Terms
Under the terms of the agreement, Linear Technology shareholders will receive $46.00 per share in cash and 0.2321 of a share of Analog Devices common stock for each share of Linear Technology common stock they hold at closing. The transaction values Linear Technology at approximately $60.00 per share(1), representing an equity value for Linear Technology of approximately $14.8 billion(1). Post-closing, Linear Technology shareholders will own approximately 16% of the combined company on a fully-diluted basis.

Analog Devices intends to fund the transaction with approximately 58 million new shares of Analog Devices common stock, approximately $7.3 billion of new long-term debt, and the remainder from the combined company’s balance sheet cash. The new long-term debt is supported by a fully underwritten bridge loan commitment and is expected to consist of term loans and bonds, with emphasis on pre-payable debt, to facilitate rapid deleveraging.

This transaction has been unanimously approved by the boards of directors of both companies. Closing of the transaction is expected by the end of the first half of calendar year 2017, and is subject to regulatory approvals in various jurisdictions, the approval of Linear Technology’s shareholders, and other customary closing conditions.

Analog Devices Financial Guidance
Analog Devices also narrowed and raised its financial guidance for its third quarter of fiscal year 2016, for revenue to be approximately $865 million, and for diluted earnings per share to be in the range of $0.71 to $0.72, and non-GAAP diluted earnings per share to be in the range of $0.77 to $0.78. The non-GAAP EPS estimate reflects estimated adjustments for amortization of purchased intangible assets and depreciation of step up value on purchased fixed assets, which total $19 million in the aggregate.

Advisors
Credit Suisse is acting as exclusive financial advisor to Analog Devices, and Wachtell, Lipton, Rosen & Katz and Wilmer Cutler Pickering Hale and Dorr LLP are serving as its legal advisors. J.P. Morgan, Bank of America Merrill Lynch, and Credit Suisse are providing committed debt financing for the transaction. Qatalyst Partners is acting as exclusive financial advisor to Linear Technology, and Jones Day is serving as its legal advisor.

Conference call and Webcast Information
Analog Devices and Linear Technology management will host a conference call today, July 26, 2016 at 5:00pm ET to discuss details of the transaction. A live webcast and the accompanying presentation relating to the transaction will be available in the “investors” section of Analog Devices’ website at www.analog.com in advance of the conference call.

Investors may join via webcast, accessible at  investor.analog.com, or by telephone (call 800-859-9560 ten minutes before the call begins and provide the password “ADI”).

A replay of the call will be made available and may be accessed for up to two weeks by dialing (855) 859-2056 (replay only) and providing the conference ID: 56173988, or by visiting  investor.analog.com.

About Analog Devices
Analog Devices designs and manufactures semiconductor products and solutions. We enable our customers to interpret the world around us by intelligently bridging the physical and digital with unmatched technologies that sense, measure and connect. Visit  http://www.analog.com.

About Linear Technology
Linear Technology, a member of the S&P 500, has been designing, manufacturing and marketing a broad line of high performance analog integrated circuits for major companies worldwide for over three decades. The company’s products provide an essential bridge between our analog world and the digital electronics in communications, networking, industrial, automotive, computer, medical, instrumentation, consumer, and military and aerospace systems. Linear Technology produces power management, data conversion, signal conditioning, RF and interface ICs, µModule® subsystems, and wireless sensor network products. For more information, visit www.linear.com.

Note:
(1) Based on Analog Devices’ 5-day volume weighted average price of $60.3215 as of July 21, 2016 per Bloomberg.

Forward Looking Statements

This press release contains forward-looking statements, which address a variety of subjects including, for example, the expected timetable for closing of the transaction between Analog Devices, Inc. (“Analog Devices”) and Linear Technology Corporation (“Linear Technology”), the expected benefits and synergies of the transaction, including the effect of the transaction on Analog Devices’ revenues, non-GAAP earnings, free cash flow, capital returns and expected growth rates of the combined companies, Analog Devices’ expected product offerings, product development, marketing position and technical advances resulting from the transaction, the availability of debt financing for the transaction, Analog Devices’ timing and ability to repay the debt and Analog Devices’ guidance for its third quarter of fiscal 2016. Statements that are not historical facts, including statements about our beliefs, plans and expectations, are forward-looking statements. Such statements are based on our current expectations and are subject to a number of factors and uncertainties, which could cause actual results to differ materially from those described in the forward-looking statements. The following important factors and uncertainties, among others, could cause actual results to differ materially from those described in these forward-looking statements: the ability to satisfy the conditions to closing of the proposed transaction, on the expected timing or at all; the ability to obtain required regulatory approvals for the proposed transaction, on the expected timing or at all, including the potential for regulatory authorities to require divestitures in connection with the proposed transaction; the occurrence of any event that could give rise to the termination of the merger agreement; the risk of stockholder litigation relating to the proposed transaction, including resulting expense or delay; higher than expected or unexpected costs associated with or relating to the transaction; the risk that expected benefits, synergies and growth prospects of the transaction may not be achieved in a timely manner, or at all; the risk that Linear Technology’s business may not be successfully integrated with Analog Devices’ following the closing; the risk that Analog Devices and Linear Technology will be unable to retain and hire key personnel; and the risk that disruption from the transaction may adversely affect Linear Technology’s or Analog Devices’ business and relationships with their customers, suppliers or employees. For additional information about factors that could cause actual results to differ materially from those described in the forward-looking statements, please refer to both Analog Devices’ and Linear Technology’s filings with the Securities and Exchange Commission (“SEC”), including the risk factors contained in each of Analog Devices’ and Linear Technology’s most recent Quarterly Reports on Form 10-Q and Annual Report on Form 10-K. Forward-looking statements represent management’s current expectations and are inherently uncertain. Except as required by law, we do not undertake any obligation to update forward-looking statements made by us to reflect subsequent events or circumstances.




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