MALVERN, Pa., and MELVILLE, N.Y., Aug. 1, 2001 -- Vishay Intertechnology, Inc. (NYSE:VSH) and General Semiconductor, Inc. (NYSE:SEM) today announced they have entered into a definitive merger agreement under which Vishay will acquire General Semiconductor, a leading manufacturer of power management devices, in a tax-free, all-stock transaction currently valued at $538.9 million plus $229.4 million of assumed debt. Shareholders of General Semiconductor will receive 0.563 shares of Vishay for each General Semiconductor share, valuing the transaction at $13.54 per General Semiconductor share based on Vishay's closing price yesterday.
The addition of complementary General Semiconductor products to Vishay's existing product line will create the premier line of discrete electronic components and position the combined company to meet a broader range of customer needs while enhancing R&D efforts focused on leading-edge power management products. The transaction is expected to be immediately accretive to Vishay's earnings and yield significant operational synergies and cost savings, expected to exceed $50 million annually when fully realized. Vishay will have a strong balance sheet with virtually no net debt, creating a platform for further strategic initiatives.
Dr. Felix Zandman, Chairman and CEO of Vishay, said, "The agreement with General Semiconductor is an outstanding strategic transaction which will clearly benefit both companies and their respective shareholders and customers. We have complementary product lines, opportunities for substantial savings and greater efficiencies, and the balance sheet to continue to expand opportunistically during the current industry downturn. General Semiconductor has many outstanding products and talented employees, and some of the finest chip designers in our industry. We are pleased to welcome them to the Vishay family."
Zandman added, "Consolidation is necessary in our industry, and Vishay is well positioned to remain at the forefront of this trend, building on the Infineon and General Semiconductor transactions. Adding General Semiconductor's strong reputation and market presence to Vishay will create an ideal platform for further growth, both organically and through acquisition, in the semiconductor component market."
Ronald A. Ostertag, Chairman and CEO of General Semiconductor, who will join the Vishay Board of Directors upon closing, said, "This is a great transaction for General Semiconductor, with a substantial upfront premium and opportunities for shareholders, customers and many of our employees to participate in the significant upside we see in the combined company. We're delighted to have found a partner who shares our strategic view, will diversify our product offerings, and has the financial strength to accelerate development of our new power management products, particularly in the MOSFET area. We will come out of this transaction a much stronger company, now able to capitalize on the current difficult environment and position ourselves for significant growth in the future."
The transaction is subject to regulatory and shareholder approvals and other customary closing conditions. It is expected to close in the fourth quarter of this year.
About Vishay Intertechnology​
Vishay, a Fortune 1,000 Company with year 2000 sales of $2.5 billion, is the largest U.S. and European manufacturer of passive electronic components (resistors, capacitors, inductors) and a major producer of discrete semiconductors (diodes, optoelectronics, transistors), IrDCs (infrared communication devices), and power and analog switching integrated circuits. The Company's components can be found in products manufactured in a very broad range of industries worldwide. With headquarters in Malvern, Pennsylvania, Vishay employs over 18,000 people in 66 plants in the U.S., Mexico, Germany, Austria, the United Kingdom, France, Portugal, the Czech Republic, Hungary, Israel, Taiwan, China and the Philippines. Vishay can be found on the Internet at http://www.vishay.com/.
About General Semiconductor
General Semiconductor, Inc. is a leader in the design, manufacture and distribution of semiconductors serving the power management market. The Company provides customers with a broad array of products including rectifiers, transient voltage suppressors, small-signal transistors, diodes, MOSFETs and Analog ICs. Its global customer base includes original equipment manufacturers, electronic distributors and contract equipment manufacturers. Key market segments for its products include automotive, computer, consumer and telecommunications.
Forward-Looking Statements are omitted