Sunnyvale, Calif. - May 9, 2005 - Zoran Corporation (Nasdaq NM: ZRAN) today announced it has signed a definitive agreement to acquire Oren Semiconductor. Based in Yoqneam, Israel, Oren provides leading edge demodulator ICs for the global high definition television market. Oren's front-end demodulator ICs complement Zoran's HDTV processors and enable Zoran to provide complete, cost-effective solutions that will accelerate the transition from analog to digital TV worldwide.
Under the terms of the agreement, Zoran will acquire the remainder of Oren's outstanding stock for $44.6 million in cash and stock. Zoran's ownership from previous investments in Oren equated to a 17 percent share, prior to the acquisition. The total imputed value of the transaction including Zoran's share would be $53.5 million. The transaction is subject to applicable regulatory approvals and other customary closing conditions and is expected to be completed during the current quarter.
Zoran expects the transaction to be accretive to the Company's earnings no later than the first quarter of 2006. Management believes that this transaction will not have a material impact on its recent guidance for the second quarter of 2005.
"We have worked with Oren for over a year to integrate its products into our platform and deliver a series of improved solutions for the growing digital television markets," said Dr. Levy Gerzberg, president and chief executive officer of Zoran. "Together we have designed new ATSC/NTSC reference designs that combine Oren's Cascade demodulator ICs with Zoran's Generation 9 and SupraHD multimedia processors. These platforms deliver a wide range of optimized solutions for our OEM customers and have already enabled us to secure multiple design wins for products that we expect to see in the market later this year. The Oren team will join Zoran's DTV division led by Ram Ofir, senior vice president and general manager. We welcome the Oren team to Zoran."
"Our collaboration with Zoran has delivered a series of turnkey platforms that shorten the design time by reducing the effort needed to finely tune hardware and software components for each new digital television appliance," said Avraham Menachem, president and chief executive officer at Oren Semiconductor. "We believe that Zoran, as a leading supplier in the digital entertainment market, is the right company to drive the acceleration to digital television and we are proud to become a part of the Zoran team."
"Technology such as that developed by Zoran and Oren could contribute to accelerating the digital transition supported by the FCC in the U.S. We expect U.S. shipments of integrated television sets to increase from 7.1 million in 2005 to 27 million in 2007 and worldwide shipments to increase from 18.7 million in 2005 to 56.4 million in 2007." said Michelle Abraham, senior analyst at Instat.
About Oren Semiconductor
Oren Semiconductor is a fabless IC manufacturer that designs develops and markets leading edge VLSI demodulator ICs for the digital television and set-top box markets. Oren is also engaged, through partnerships, in providing customers with complete front-end solutions. Oren's technological leadership position is achieved by combining patented DSP-based technologies with experience in VSB and high-level integration. Oren's VSB demodulator products enable clear reception of VSB modulated signals in the tough environment of terrestrial transmissions for digital television, especially in the presence of reflections and Doppler effects, which are common in urban areas. The end results are components which are easily customized, programmed, reconfigured and upgraded. Oren sells its products through direct sales, distributors, and OEMs worldwide. Established in 1994, Oren is a privately held company with headquarters in Yoqneam, Israel and sales offices in Santa Clara, California.
About Zoran
Zoran Corporation, based in Sunnyvale, California, is a leading provider of digital solutions in the growing digital entertainment and digital imaging markets. With two decades of expertise developing and delivering digital signal processing technologies, Zoran has pioneered high-performance digital audio and video, imaging applications, and Connect and Share technologies for the digital home. Zoran's proficiency in integration delivers major benefits for OEM customers, including greater capabilities within each product generation, reduced system costs, and shorter time to market. Zoran-based DVD, digital camera, DTV, multimedia mobile phone and multifunction printer products have received recognition for excellence and are now in millions of homes and offices worldwide. With headquarters in the U.S. and operations in Canada, China, England, Germany, Israel, Japan, Korea, and Taiwan, Zoran may be contacted on the World Wide Web at www.zoran.com