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O’Melveny Represents Microsemi in US$300 Million Sale of Business to Mercury Systems

March 28, 2016

FOR IMMEDIATE RELASE

SILICON VALLEY ─ March 28, 2016 ─ O’Melveny represented Microsemi Corporation in a definitive agreement to divest a component of a board level systems and packaging business to Mercury Systems, Inc. for US$300 million. The deal, which is subject to standard regulatory approvals and customary closing conditions, is expected to close during Microsemi’s third fiscal quarter of 2016.

The O’Melveny team was led by partners Paul Scrivano and Warren Lazarow, and included counsel Angola Russell, and associates Sarah Young, Noah Kornblith, Jake Israel, and Martha Todd.

About O’Melveny
O’Melveny’s clients shape markets, set precedents, and break boundaries. They are stalwarts and innovators, the names you trust and the next big thing. And for more than a century, O’Melveny has been right beside them, kicking down walls and putting up defenses to help our clients achieve their most important goals. With approximately 700 lawyers in 15 offices worldwide guided by the principles of excellence, leadership, and citizenship, we uphold a tradition of treating our clients’ challenges and opportunities as our own. What do you want to achieve? For the answers, please visit www.omm.com.

Contact:
Julie Fei
O’Melveny & Myers LLP
213.430.7792
jfei@omm.com 


The following was released by Microsemi:

Microsemi Announces Definitive Agreement to Divest Business to Mercury Systems, Inc.

- Company Focusing on Core Strategic Solutions, Continuing Move Toward Higher Value IC and SoC Offerings

- Improves Company's Overall Profitability Metrics and Growth Profile


ALISO VIEJO, Calif., March 23, 2016 /PRNewswire/ -- Microsemi Corporation (Nasdaq: MSCC), a leading provider of semiconductor solutions differentiated by power, security, reliability and performance, today announced it has entered into a definitive agreement to divest a non-strategic component of a board level systems and packaging business to Mercury Systems, Inc. (Nasdaq: MRCY), for $300 million in cash (subject to a customary purchase price adjustment).

"This carve out is advantageous to Microsemi both strategically and financially," said James J. Peterson, chairman and CEO of Microsemi. "It allows the company to intensify its focus and frees up investment capital for the ongoing development of proprietary, higher-value solutions for our aerospace & defense, communications, industrial and storage end markets. The resulting business model will be more profitable with better growth opportunities and, importantly, all proceeds from this sale will be used to retire debt associated with the recent acquisition of PMC-Sierra."

Microsemi's board of directors has approved the transaction, which remains subject to regulatory approvals and customary closing conditions. The deal is expected to close during Microsemi's third fiscal quarter of 2016, ending July 3. Microsemi will discuss the transaction in further detail during its upcoming second fiscal quarter conference call, currently targeted for April 28, 2016.

The proceeds from the divested business, along with an incremental $100 million from available cash, will enable the company to reduce the debt to EBITDA ratio significantly ahead of schedule as announced at the close of the acquisition.

Microsemi also reaffirms its fiscal second quarter guidance included in its fiscal first quarter earnings release issued on Jan. 25, 2016.

About Microsemi
Microsemi Corporation (Nasdaq: MSCC) offers a comprehensive portfolio of semiconductor and system solutions for communications, defense & security, aerospace and industrial markets. Products include high-performance and radiation-hardened analog mixed-signal integrated circuits, FPGAs, SoCs and ASICs; power management products; timing and synchronization devices and precise time solutions, setting the world's standard for time; voice processing devices; RF solutions; discrete components; enterprise storage and communication solutions, security technologies and scalable anti-tamper products; Ethernet solutions; Power-over-Ethernet ICs and midspans; as well as custom design capabilities and services. Microsemi is headquartered in Aliso Viejo, Calif., and has approximately 4,800 employees globally. Learn more at www.microsemi.com.

Contact:
Financial: John W. Hohener, Executive Vice President and CFO, 949-380-6100 or Investor: Robert C. Adams, Vice President of Corporate Development, 949-380-6100