UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE
SECURITIES EXCHANGE ACT OF 1934
Filed by the
Registrant
x
Filed by a
Party other than the Registrant
¨
Check the
appropriate box:
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¨
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Preliminary Proxy Statement
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¨
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Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
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¨
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Definitive Proxy Statement
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x
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Definitive Additional Materials
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¨
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Soliciting Material Pursuant to §240.14a-11(c) or §240.14a-2
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RF MONOLITHICS, INC.
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(Name of Registrant as Specified In Its Charter)
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
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Payment of Filing Fee (Check the appropriate box):
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x
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No fee required.
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¨
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Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
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(1)
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Title of each class of securities to which transaction applies:
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(2)
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Aggregate number of securities to which transaction applies:
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(3)
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Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
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(4)
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Proposed maximum aggregate value of transaction:
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(5)
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Total fee paid:
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¨
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Fee paid previously with preliminary materials.
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¨
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Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify
the previous filing by registration statement number, or the Form or Schedule and the date of its filing.
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(1)
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Amount Previously Paid:
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(2)
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Form, Schedule or Registration Statement No.:
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(3)
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Filing Party:
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(4)
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Date Filed:
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These Definitive Additional Materials are being filed with the Securities and Exchange
Commission (SEC) on June 20, 2012 in connection with certain litigation relating to the Agreement and Plan of Merger, dated April 12, 2012 (as it may be amended from time to time, the Merger Agreement), among RF
Monolithics, Inc. (RFM or the Company), Murata Electronics North America, Inc. (MENA) and Ryder Acquisition Company, Limited (Merger Sub). On May 30, 2012, RFM filed a definitive proxy statement
(the Definitive Proxy Statement) with the SEC in connection with the Merger Agreement and the proposed merger. These Definitive Additional Materials supplement the disclosures made in the Definitive Proxy Statement, and should be read
alongside the Definitive Proxy Statement.
SETTLEMENT OF LITIGATION
On June 20, 2012, solely to avoid the costs, risks and uncertainties inherent in litigation and to allow its
stockholders to vote on the proposals required in connection with the proposed merger with MENA at the special meeting of its stockholders, RFM entered into a memorandum of understanding with plaintiffs and other named defendants, including MENA and
Ryder Acquisition Company, Limited (Merger Sub), to tentatively settle, subject to formal stipulation of settlement and court approval, two putative class action lawsuits captioned
Ron Anshel, et al. v. RF Monolithics, Inc., et
al.
, Cause No. DC-12-04250-G, pending in the 134
th
Judicial District Court of Dallas County, Texas (the Texas Lawsuit), and
Robert E. Stigall, et al. v. Farlin A. Halsey, et al.
, Civil Action No. 7468-VCG, pending in the Court of Chancery of the State of Delaware (the
Delaware Lawsuit). Those class action lawsuits were filed purportedly on behalf of RFM stockholders following the public announcement of the execution of the Merger Agreement.
As described in the Definitive Proxy Statement, RFM, its directors, MENA and Merger Sub were named as defendants in the Texas Lawsuit and
the Delaware Lawsuit, each in connection with the proposed merger. On May 31, 2012, the plaintiff in the Texas Lawsuit filed an amended class action complaint. The complaints in the class action lawsuits, as amended, allege, among other things,
that the members of the board of directors of RFM violated their fiduciary duties by engaging in an unfair process, approving
the Merger Agreement and recommending the Merger Agreement for approval by RFM stockholders; that the Merger Agreement does not maximize value for RFM stockholders; that the Merger Agreement
contains coercive deal protection measures; and that the Definitive Proxy Statement omits material facts and/or contains materially misleading statements. The complaints in the class action lawsuits also allege that RFM, MENA and Merger
Sub aided and abetted the individual defendants alleged breaches of fiduciary duties. The class action lawsuits seek to, among other things, enjoin the proposed merger from proceeding.
Under the terms of the memorandum of understanding, RFM, the other named defendants, including MENA and Merger Sub, and the
plaintiffs in the Texas Lawsuit and the Delaware Lawsuit have agreed to settle both lawsuits and all related claims subject to court approval. The memorandum of understanding requires that the plaintiffs submit a stipulation of settlement to
the court in the Texas Lawsuit. If the court approves the settlement contemplated in the memorandum of understanding, the claims of plaintiffs in both cases and all class members will be released and both lawsuits will be dismissed with
prejudice. Pursuant to the terms of the memorandum of understanding, RFM has agreed to make available additional information to its stockholders in advance of the special meeting of stockholders of RFM to be held at 10:00 a.m., local time, on
June 29, 2012, at RFMs principal executive offices, at which meeting RFM stockholders will vote upon the proposal to adopt and approve the Merger Agreement. The additional information is contained below and should be read in conjunction
with the Definitive Proxy Statement. In connection with the settlement, lawyers for plaintiffs in the lawsuits intend to seek an award of attorneys fees and expenses, which will be subject to court approval. RFM has agreed to pay the legal
fees and expenses of plaintiffs counsel, in an amount to be determined by the court. If the settlement is finally approved by the court, it is anticipated that the settlement will resolve and release all claims in all actions that were or
could have been brought challenging any aspect of the proposed merger, the Merger Agreement and any disclosure made in connection therewith. There can be no assurance that the parties will ultimately enter into a stipulation of settlement or
that the court will approve the settlement even if the parties were to enter into such stipulation. In such event, the proposed settlement as contemplated by the memorandum of understanding may be terminated. The details of the settlement will
be set forth in a notice to be sent to RFM stockholders prior to a final hearing before the court to consider both the settlement and plaintiffs application to the court for attorneys fees and expenses.
The settlement will not affect the merger consideration to be paid to RFM stockholders in connection with the proposed merger or the
timing of the special meeting of stockholders mentioned above.
RFM and the other defendants, including MENA and Merger Sub,
have vigorously denied, and continue vigorously to deny, that they have committed or aided and abetted the commission of any violation of law or engaged in any of the wrongful acts that were or could have been alleged in the lawsuits, and expressly
maintain that, to the extent applicable, they diligently and scrupulously complied with their fiduciary and other legal duties and are entering into the contemplated settlement solely to eliminate the burden and expense of further litigation, to put
the claims that were or could have been asserted to rest, and to avoid any possible delay to the completion of the merger that might arise from further litigation. Nothing in this filing, the memorandum of understanding or any stipulation of
settlement shall be deemed an admission of the legal necessity or materiality under applicable laws of any of the disclosures set forth herein.
SUPPLEMENT TO DEFINITIVE PROXY STATEMENT
In the settlement of the class
action lawsuits as set forth in this filing, RFM agreed to make these supplemental disclosures to the Definitive Proxy Statement. These disclosures should be read in
connection with the Definitive Proxy Statement, which should be read carefully and in its entirety. Defined terms used but not defined herein have the meanings set forth in the Definitive
Proxy Statement. Without admitting in any way that the disclosures below are material or otherwise required by law, RFM makes the following supplemental disclosures:
Additional Information Regarding Opinion of Duff & Phelps
The data set
forth in the first three tables below was provided to the special committee of the board of directors by its financial advisor, Duff & Phelps, LLC (Duff & Phelps), at the meeting of the special committee held on
April 12, 2012, in connection with Duff & Phelps selected public companies and merger and acquisition transactions analyses that are described in the Definitive Proxy Statement. The data was obtained from various public sources
and was not independently verified by Duff & Phelps, RFM or the special committee. The data below, and the opinion of Duff & Phelps that is attached to the Definitive Proxy Statement and described in the Definitive Proxy Statement
beginning on page 40 under the caption The MergerOpinion of Duff & Phelps, were addressed to the special committee and provided for the benefit of the special committee in connection with its evaluation of the proposed
merger.
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Selected Public Companies Analysis
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April 11, 2012
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(dollars in millions, except per share data)
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Company Information
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Market Data
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Revenue Growth
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EBITDA Growth
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EBITDA Margin
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EBIT Margin
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Company Name
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Stock
Price
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% of
52-Wk
High
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Enterprise
Value
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3-YR
CAGR
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LTM
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2012
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2013
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3-YR
CAGR
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LTM
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2012
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2013
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3-YR
AVG
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LTM
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2012
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2013
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3-YR
AVG
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LTM
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2012
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2013
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Anaren Inc. (1)
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$
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17.59
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80.8
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%
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$
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213
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10.9
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%
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-5.6
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%
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-14.1
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%
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15.9
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%
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23.8
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%
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-23.3
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%
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-10.7
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%
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55.1
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%
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16.9
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%
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15.2
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%
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17.1
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%
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22.8
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%
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11.0
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%
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9.0
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%
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14.4
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%
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17.6
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%
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AzureWave Technologies, Inc. (2)
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1.00
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70.0
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144
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NA
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4.3
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148.7
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41.3
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NA
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-70.0
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153.6
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21.8
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6.7
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2.2
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3.8
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3.7
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4.3
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-0.6
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NA
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NA
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Digi International Inc. (1)
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10.46
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69.5
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162
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3.3
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7.8
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6.3
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13.1
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-0.8
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21.9
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4.1
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43.5
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10.9
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12.2
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12.7
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16.2
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5.6
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7.8
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10.4
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13.1
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IXYS Corp. (1)
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12.50
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78.8
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345
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6.1
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10.1
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-8.9
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12.1
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19.6
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5.9
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-19.1
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35.9
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12.9
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16.4
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15.5
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18.8
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7.6
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12.6
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15.0
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NA
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Melexis NV (2)
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17.16
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99.0
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716
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7.5
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5.1
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6.4
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8.1
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17.1
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-2.1
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5.6
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7.6
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24.6
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28.8
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28.6
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28.5
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18.4
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23.6
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23.2
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23.6
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Nihon Dempa Kogyo Co. Ltd. (1)
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13.71
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84.2
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440
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-10.9
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-5.4
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-1.0
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4.3
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-32.5
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-17.4
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26.1
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13.7
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7.7
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8.7
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11.3
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12.3
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-1.5
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2.9
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NA
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NA
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Pericom Semiconductor Corp. (1)
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8.24
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79.5
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75
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0.5
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-8.0
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NA
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NA
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-13.0
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-35.3
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NA
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NA
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9.8
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8.3
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NA
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NA
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3.7
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0.4
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NA
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NA
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Sierra Wireless Inc. (1)
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7.03
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58.6
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107
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0.6
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-11.1
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3.5
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7.6
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-36.0
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-57.3
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30.4
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NA
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4.6
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2.8
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4.0
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NA
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-1.2
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-2.8
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NA
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NA
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Telit Communications PLC (2)
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0.97
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57.8
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100
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44.3
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85.4
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-21.8
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10.2
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72.5
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53.0
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43.2
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16.9
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5.4
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6.0
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11.1
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11.7
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2.4
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2.0
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NA
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NA
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u-blox Holding AG (2)
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45.08
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83.1
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195
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18.7
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10.6
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34.1
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16.5
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35.4
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9.9
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16.8
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14.6
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18.9
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21.0
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19.5
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21.0
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13.7
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17.0
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13.5
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15.2
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Mean
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76.1
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%
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250
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9.0
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%
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9.3
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%
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17.0
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%
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14.3
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%
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9.5
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%
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-11.5
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%
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27.8
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%
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26.1
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%
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11.8
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%
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12.2
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%
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13.7
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%
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16.9
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%
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6.4
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%
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7.2
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%
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15.3
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%
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17.4
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%
|
Median
|
|
|
|
|
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79.1
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%
|
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179
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6.1
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%
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|
4.7
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%
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3.5
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%
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|
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12.1
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%
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17.1
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%
|
|
|
-9.7
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%
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16.8
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%
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19.3
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%
|
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|
10.4
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%
|
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|
10.4
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%
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12.7
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%
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|
17.5
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%
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|
4.9
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%
|
|
|
5.4
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%
|
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|
14.4
|
%
|
|
|
16.4
|
%
|
|
|
|
|
|
|
|
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|
|
|
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|
RF Monolithics, Inc. (Analyst Projections) (3)
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$
|
0.97
|
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66.0
|
%
|
|
$
|
13
|
|
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|
-15.9
|
%
|
|
|
-3.9
|
%
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5.0
|
%
|
|
|
14.2
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%
|
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-28.0
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%
|
|
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-40.8
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%
|
|
|
0.1
|
%
|
|
|
54.2
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%
|
|
|
3.8
|
%
|
|
|
3.4
|
%
|
|
|
3.6
|
%
|
|
|
5.1
|
%
|
|
|
2.7
|
%
|
|
|
-6.4
|
%
|
|
|
1.4
|
%
|
|
|
1.4
|
%
|
RF Monolithics, Inc. (Management Projections) (4)
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|
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|
|
|
|
|
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-15.9
|
%
|
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-1.6
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%
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5.1
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%
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11.7
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%
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-23.5
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%
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-26.1
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%
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9.1
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%
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28.0
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%
|
|
|
6.2
|
%
|
|
|
5.3
|
%
|
|
|
6.3
|
%
|
|
|
7.2
|
%
|
|
|
3.0
|
%
|
|
|
3.4
|
%
|
|
|
4.5
|
%
|
|
|
5.6
|
%
|
(1)
|
Financial projections are based on the four quarters ending September 30
|
(2)
|
Financial projections are based on the four quarters ending December 31
|
(3)
|
LTM date as of November 30, 2011
|
(4)
|
Adjusted EBITDA and EBIT includes stock based compensation expense and excludes public company costs. LTM date as of February 29, 2012
|
LTM = Latest Twelve Months
CAGR = Compounded
Annual Growth Rate
Enterprise Value = (Market Capitalization) + (Debt + Preferred Stock + Minority Interest) - (Cash & Equivalents) -
(Net Non-operating Assets)
EBITDA = Earnings Before Interest, Taxes, Depreciation and Amortization
EBIT = Earnings Before Interest and Taxes
Source: Bloomberg, Capital IQ, SEC filings
|
|
|
Selected Public Companies Analysis
|
|
April 11, 2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(dollars in millions, except per share data)
|
|
Company Information
|
|
Enterprise Value as Multiple of
|
|
|
Stock Price as a Multiple of
|
|
Company Name
|
|
LTM
EBITDA
|
|
|
2012
EBITDA
|
|
|
2013
EBITDA
|
|
|
LTM
Revenue
|
|
|
2012
Revenue
|
|
|
LTM
EPS
|
|
|
2012
EPS
|
|
|
2013
EPS
|
|
|
|
|
|
|
|
|
|
|
Anaren Inc. (1)
|
|
|
8.5
|
x
|
|
|
8.1
|
x
|
|
|
5.2
|
x
|
|
|
1.29
|
x
|
|
|
1.38
|
x
|
|
|
23.3
|
x
|
|
|
23.8
|
x
|
|
|
13.8
|
x
|
AzureWave Technologies, Inc. (2)
|
|
|
NM
|
|
|
|
11.1
|
|
|
|
9.1
|
|
|
|
0.63
|
|
|
|
0.43
|
|
|
|
NM
|
|
|
|
21.0
|
|
|
|
15.7
|
|
Digi International Inc. (1)
|
|
|
6.6
|
|
|
|
5.9
|
|
|
|
4.1
|
|
|
|
0.80
|
|
|
|
0.75
|
|
|
|
27.8
|
|
|
|
21.8
|
|
|
|
14.4
|
|
IXYS Corp. (1)
|
|
|
5.6
|
|
|
|
6.3
|
|
|
|
4.6
|
|
|
|
0.91
|
|
|
|
0.97
|
|
|
|
9.4
|
|
|
|
10.9
|
|
|
|
9.7
|
|
Melexis NV (2)
|
|
|
8.2
|
|
|
|
7.8
|
|
|
|
7.2
|
|
|
|
2.37
|
|
|
|
2.23
|
|
|
|
12.5
|
|
|
|
11.4
|
|
|
|
10.4
|
|
Nihon Dempa Kogyo Co. Ltd. (1)
|
|
|
7.8
|
|
|
|
6.0
|
|
|
|
5.3
|
|
|
|
0.68
|
|
|
|
0.68
|
|
|
|
15.9
|
|
|
|
10.2
|
|
|
|
8.3
|
|
Pericom Semiconductor Corp. (1)
|
|
|
6.1
|
|
|
|
NA
|
|
|
|
NA
|
|
|
|
0.50
|
|
|
|
NA
|
|
|
|
NM
|
|
|
|
NA
|
|
|
|
NA
|
|
Sierra Wireless Inc. (1)
|
|
|
6.7
|
|
|
|
4.3
|
|
|
|
NA
|
|
|
|
0.19
|
|
|
|
0.17
|
|
|
|
NM
|
|
|
|
11.6
|
|
|
|
8.9
|
|
Telit Communications PLC (2)
|
|
|
9.3
|
|
|
|
6.5
|
|
|
|
5.6
|
|
|
|
0.56
|
|
|
|
0.72
|
|
|
|
NM
|
|
|
|
14.9
|
|
|
|
13.7
|
|
u-blox Holding AG (2)
|
|
|
6.8
|
|
|
|
5.8
|
|
|
|
5.1
|
|
|
|
1.43
|
|
|
|
1.14
|
|
|
|
15.9
|
|
|
|
15.0
|
|
|
|
12.7
|
|
|
|
|
|
|
|
|
|
|
Mean
|
|
|
7.3
|
x
|
|
|
6.9
|
x
|
|
|
5.8
|
x
|
|
|
0.94
|
x
|
|
|
0.94
|
x
|
|
|
17.5
|
x
|
|
|
15.6
|
x
|
|
|
12.0
|
x
|
Median
|
|
|
6.8
|
x
|
|
|
6.3
|
x
|
|
|
5.2
|
x
|
|
|
0.74
|
x
|
|
|
0.75
|
x
|
|
|
15.9
|
x
|
|
|
14.9
|
x
|
|
|
12.7
|
x
|
|
|
|
|
|
|
|
|
|
RF Monolithics, Inc. (Analyst Projections) (3)
|
|
|
11.8
|
x
|
|
|
10.6
|
x
|
|
|
6.9
|
x
|
|
|
0.40
|
x
|
|
|
0.38
|
x
|
|
|
48.5
|
x
|
|
|
48.5
|
x
|
|
|
12.1
|
x
|
(1)
|
Financial projections are based on the four quarters ending September 30
|
(2)
|
Financial projections are based on the four quarters ending December 31
|
(3)
|
LTM date as of November 30, 2011
|
LTM =
Latest Twelve Months
Enterprise Value = (Market Capitalization) + (Debt + Preferred Stock + Minority Interest) - (Cash & Equivalents)
- (Net Non-operating Assets)
EBITDA = Earnings Before Interest, Taxes, Depreciation and Amortization
EPS = Earnings Per Share
Source: Bloomberg,
Capital IQ, SEC filings
Selected Mergers and Acquisitions Transactions Analysis
Selected Transactions Analysis
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(dollars in millions)
|
|
Announced
|
|
Target Name
|
|
Acquirer Name
|
|
Enterprise
Value
(EV)
|
|
|
LTM
Revenue
|
|
|
LTM
EBITDA
|
|
|
LTM
EBITDA
Margin
|
|
|
LTM
Revenue
Growth
|
|
|
LTM
EBITDA
Growth
|
|
|
EV /
Revenue
|
|
|
EV /
EBITDA
|
|
1/23/2012
|
|
Gennum Corporation
|
|
Semtech Canada Inc.
|
|
$
|
474.0
|
|
|
$
|
137.2
|
|
|
$
|
31.1
|
|
|
|
22.7
|
%
|
|
|
6.4
|
%
|
|
|
-10.0
|
%
|
|
|
3.46
|
x
|
|
|
15.2
|
x
|
|
|
|
|
|
|
|
|
|
|
|
11/30/2011
|
|
Commercial Microwave Technology (assets)
|
|
API Technologies
|
|
$
|
8.2
|
|
|
$
|
8.0
|
|
|
$
|
2.5
|
|
|
|
31.3
|
%
|
|
|
NA
|
|
|
|
NA
|
|
|
|
1.03
|
x
|
|
|
3.3
|
x
|
|
|
|
|
|
|
|
|
|
|
|
10/27/2011
|
|
MOSAID Technologies Inc.
|
|
Sterling Partners
|
|
$
|
445.6
|
|
|
$
|
80.7
|
|
|
$
|
42.3
|
|
|
|
52.4
|
%
|
|
|
13.4
|
%
|
|
|
1.4
|
%
|
|
|
5.52
|
x
|
|
|
10.5
|
x
|
|
|
|
|
|
|
|
|
|
|
|
10/10/2011
|
|
VTI Technologies Oy
|
|
Murata Electronics Europe B.V.
|
|
$
|
266.8
|
|
|
$
|
103.3
|
|
|
$
|
16.4
|
|
|
|
15.8
|
%
|
|
|
NA
|
|
|
|
NA
|
|
|
|
2.58
|
x
|
|
|
16.3
|
x
|
|
|
|
|
|
|
|
|
|
|
|
7/29/2011
|
|
AIC Corporation Berhad
|
|
Temasek Formation Sdn. Bhd.
|
|
$
|
119.9
|
|
|
$
|
51.7
|
|
|
$
|
10.6
|
|
|
|
20.4
|
%
|
|
|
3.1
|
%
|
|
|
-10.6
|
%
|
|
|
2.32
|
x
|
|
|
11.4
|
x
|
|
|
|
|
|
|
|
|
|
|
|
5/26/2011
|
|
Advanced Analogic Technologies, Inc.
|
|
Skyworks Solutions Inc.
|
|
$
|
171.7
|
|
|
$
|
90.7
|
|
|
-$
|
6.9
|
|
|
|
NM
|
|
|
|
-0.2
|
%
|
|
|
NM
|
|
|
|
1.89
|
x
|
|
|
NM
|
|
|
|
|
|
|
|
|
|
|
|
|
5/20/2011
|
|
Zarlink Semiconductor
|
|
Microsemi Corp.
|
|
$
|
501.9
|
|
|
$
|
227.0
|
|
|
$
|
34.1
|
|
|
|
15.0
|
%
|
|
|
6.3
|
%
|
|
|
-8.3
|
%
|
|
|
2.21
|
x
|
|
|
14.7
|
x
|
|
|
|
|
|
|
|
|
|
|
|
5/17/2011
|
|
SiGe Semiconductor
|
|
Skyworks Solutions Inc.
|
|
$
|
285.0
|
|
|
$
|
103.3
|
|
|
$
|
6.0
|
|
|
|
5.8
|
%
|
|
|
25.1
|
%
|
|
|
NM
|
|
|
|
2.76
|
x
|
|
|
47.9
|
x
|
|
|
|
|
|
|
|
|
|
|
|
3/28/2011
|
|
Spectrum Control
|
|
API Technologies
|
|
$
|
269.8
|
|
|
$
|
167.3
|
|
|
$
|
29.3
|
|
|
|
17.5
|
%
|
|
|
22.0
|
%
|
|
|
53.6
|
%
|
|
|
1.61
|
x
|
|
|
9.2
|
x
|
|
|
|
|
|
|
|
|
|
|
|
3/16/2011
|
|
Ralink Technology, Corp.
|
|
MediaTek Inc.
|
|
$
|
289.3
|
|
|
$
|
286.5
|
|
|
$
|
32.9
|
|
|
|
11.5
|
%
|
|
|
37.9
|
%
|
|
|
7.3
|
%
|
|
|
1.01
|
x
|
|
|
8.8
|
x
|
|
|
|
|
|
|
|
|
|
|
|
2/10/2011
|
|
SiTel Semiconductor
|
|
Dialog Semiconductor
|
|
$
|
86.5
|
|
|
$
|
116.9
|
|
|
|
NA
|
|
|
|
NA
|
|
|
|
NA
|
|
|
|
NA
|
|
|
|
0.74
|
x
|
|
|
NA
|
|
|
|
|
|
|
|
|
|
|
|
|
1/28/2011
|
|
Motorola Israel (m2m Modules Division)
|
|
Telit Communications
|
|
$
|
22.5
|
|
|
$
|
50.1
|
|
|
|
NA
|
|
|
|
NA
|
|
|
|
NA
|
|
|
|
NA
|
|
|
|
0.45
|
x
|
|
|
NA
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(dollars in millions)
|
|
Announced
|
|
Target Name
|
|
Acquirer Name
|
|
Enterprise
Value
(EV)
|
|
|
LTM
Revenue
|
|
|
LTM
EBITDA
|
|
|
LTM
EBITDA
Margin
|
|
|
LTM
Revenue
Growth
|
|
|
LTM
EBITDA
Growth
|
|
|
EV /
Revenue
|
|
|
EV /
EBITDA
|
|
1/24/2011
|
|
Si En Integration
|
|
Integrated Silicon Solution
|
|
$
|
20.0
|
|
|
$
|
22.2
|
|
|
|
NA
|
|
|
|
NA
|
|
|
|
NA
|
|
|
|
NA
|
|
|
|
0.90
|
x
|
|
|
NA
|
|
|
|
|
|
|
|
|
|
|
|
|
1/18/2011
|
|
Conexant Systems Inc.
|
|
Golden Gate Private Equity, Inc.
|
|
$
|
291.2
|
|
|
$
|
225.0
|
|
|
$
|
37.3
|
|
|
|
16.6
|
%
|
|
|
5.8
|
%
|
|
|
67.3
|
%
|
|
|
1.29
|
x
|
|
|
7.8
|
x
|
|
|
|
|
|
|
|
|
|
|
|
11/24/2010
|
|
CPI International
|
|
Veritas Capital
|
|
$
|
527.4
|
|
|
$
|
360.4
|
|
|
$
|
58.6
|
|
|
|
16.2
|
%
|
|
|
8.3
|
%
|
|
|
15.3
|
%
|
|
|
1.46
|
x
|
|
|
9.0
|
x
|
|
|
|
|
|
|
|
|
|
|
|
11/8/2010
|
|
Enfora
|
|
Novatel Wireless
|
|
$
|
83.5
|
|
|
$
|
61.3
|
|
|
$
|
1.4
|
|
|
|
2.4
|
%
|
|
|
NA
|
|
|
|
NA
|
|
|
|
1.36
|
x
|
|
|
NM
|
|
|
|
|
|
|
|
|
|
|
|
|
9/7/2010
|
|
Microtune, Inc.
|
|
Zoran Corporation
|
|
$
|
77.5
|
|
|
$
|
85.8
|
|
|
-$
|
0.9
|
|
|
|
-1.0
|
%
|
|
|
-6.1
|
%
|
|
|
NM
|
|
|
|
0.90
|
x
|
|
|
NM
|
|
|
|
|
|
|
|
|
|
|
|
|
6/29/2010
|
|
Cinterior Wireless Modules
|
|
Gemalto NV
|
|
$
|
202.0
|
|
|
$
|
176.9
|
|
|
|
NA
|
|
|
|
NA
|
|
|
|
NA
|
|
|
|
NA
|
|
|
|
1.14
|
x
|
|
|
NA
|
|
|
|
|
|
|
|
|
|
|
|
|
6/17/2010
|
|
Innovision Research & Technology
|
|
Broadcom Corp.
|
|
$
|
41.3
|
|
|
$
|
3.1
|
|
|
-$
|
4.4
|
|
|
|
NM
|
|
|
|
81.1
|
%
|
|
|
NM
|
|
|
|
13.33
|
x
|
|
|
NM
|
|
|
|
|
|
|
|
|
|
|
|
|
6/11/2010
|
|
Sage Laboratories
|
|
Spectrum Microwave
|
|
$
|
6.5
|
|
|
$
|
12.0
|
|
|
|
NA
|
|
|
|
NA
|
|
|
|
26.0
|
%
|
|
|
NA
|
|
|
|
0.54
|
x
|
|
|
NA
|
|
Source: Capital IQ and public filings with the SEC.
None of the companies listed in the tables above are directly comparable to RFM, and none of the mergers and acquisition transactions listed in the table above are directly comparable to the merger.
Duff & Phelps did not have access to nonpublic information related to any of the companies or transactions set forth in the tables above. A complete valuation analysis cannot be limited to quantitative review of the selected companies and
selected transactions, and involves complex considerations and judgments concerning differences in financial and operating characteristics of such companies and transactions, as well as other factors that could affect their value relative to that of
RFM.
Considering the data above without considering the full text of Duff & Phelps opinion and the full narrative description
of the financial analyses performed by Duff & Phelps that are included in the Definitive Proxy Statement, including the assumptions made, procedures followed, matters considered and qualifications and limitations of the review undertaken in
connection with Duff & Phelps opinion, could create a misleading or incomplete view of Duff & Phelps financial analyses or opinion.
Additional Prospective Financial Information of RFM
The following sets forth the
financial projections of RFM for the fiscal years 2017, 2018, 2019, 2020 and 2021 (the 2017-2021 Projections) that are referenced in the Definitive Proxy Statement under the caption The MergerCertain Prospective Financial
Information beginning on page 47. The 2017-2021 Projections
were extrapolated from the April 2012 projections disclosed in the Definitive Proxy Statement. They were also utilized by Duff & Phelps in its discounted cash flow analysis as discussed
under the caption DCF Projections on page 52 of the Definitive Proxy Statement. As noted in the Definitive Proxy Statement, the April 2012 projections updated the January 2012 projections that are disclosed in the Definitive Proxy
Statement to reflect the most recent historical operating data for fiscal year 2012 at the time and to make other changes described on page 50 of the Definitive Proxy Statement, including the elimination of public company costs and the assumed
replacement of stock-based compensation with cash compensation, for the purpose of valuing RFM in connection with a potential sale rather than as a standalone entity. The full discussion of RFMs prospective financial information beginning
on page 47 of the Definitive Proxy Statement, including the qualifications and limitations described and the assumptions used to prepare such information, all of which are applicable to the 2017-2021 Projections below, should be read carefully and
in its entirety.
2017-2021 Projections
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(dollars in millions)
|
|
2017
|
|
|
2018
|
|
|
2019
|
|
|
2020
|
|
|
2021
|
|
Sales
|
|
$
|
73.8
|
|
|
$
|
82.5
|
|
|
$
|
89.1
|
|
|
$
|
93.0
|
|
|
$
|
95.8
|
|
Gross profit margin
|
|
|
36.1
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%
|
|
|
36.1
|
%
|
|
|
36.1
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%
|
|
|
36.0
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%
|
|
|
36.0
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%
|
Public company costs (1)
|
|
$
|
0.0
|
|
|
$
|
0.0
|
|
|
$
|
0.0
|
|
|
$
|
0.0
|
|
|
$
|
0.0
|
|
Income from operations
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|
$
|
7.6
|
|
|
$
|
8.5
|
|
|
$
|
9.1
|
|
|
$
|
9.5
|
|
|
$
|
9.8
|
|
Net income
|
|
$
|
4.9
|
|
|
$
|
5.5
|
|
|
$
|
5.9
|
|
|
$
|
6.2
|
|
|
$
|
6.3
|
|
Adjusted EBITDA
|
|
$
|
8.1
|
|
|
$
|
9.0
|
|
|
$
|
9.8
|
|
|
$
|
10.2
|
|
|
$
|
10.5
|
|
Unlevered free cash flow
|
|
$
|
2.4
|
|
|
$
|
3.2
|
|
|
$
|
4.2
|
|
|
$
|
5.1
|
|
|
$
|
5.6
|
|
|
|
|
|
|
|
Reconciliation of Non-GAAP Measures for the 2017-2021 Projections
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2017
|
|
|
2018
|
|
|
2019
|
|
|
2020
|
|
|
2021
|
|
Reconciliation of Adjusted EBITDA:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
|
|
$
|
4.9
|
|
|
$
|
5.5
|
|
|
$
|
5.9
|
|
|
$
|
6.2
|
|
|
$
|
6.3
|
|
Interest expense, net (2)
|
|
$
|
0.0
|
|
|
$
|
0.0
|
|
|
$
|
0.0
|
|
|
$
|
0.0
|
|
|
$
|
0.0
|
|
Taxes (3)
|
|
$
|
2.7
|
|
|
$
|
3.0
|
|
|
$
|
3.2
|
|
|
$
|
3.3
|
|
|
$
|
3.4
|
|
Depreciation and amortization
|
|
$
|
0.5
|
|
|
$
|
0.6
|
|
|
$
|
0.7
|
|
|
$
|
0.7
|
|
|
$
|
0.7
|
|
Stock-based compensation expense (4)
|
|
$
|
0.0
|
|
|
$
|
0.0
|
|
|
$
|
0.0
|
|
|
$
|
0.0
|
|
|
$
|
0.0
|
|
Adjusted EBITDA
|
|
$
|
8.1
|
|
|
$
|
9.0
|
|
|
$
|
9.8
|
|
|
$
|
10.2
|
|
|
$
|
10.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2017
|
|
|
2018
|
|
|
2019
|
|
|
2020
|
|
|
2021
|
|
Reconciliation of Free Cash Flow:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
|
|
$
|
4.9
|
|
|
$
|
5.5
|
|
|
$
|
5.9
|
|
|
$
|
6.2
|
|
|
$
|
6.3
|
|
Depreciation and amortization
|
|
$
|
0.5
|
|
|
$
|
0.6
|
|
|
$
|
0.7
|
|
|
$
|
0.7
|
|
|
$
|
0.7
|
|
Stock-based compensation expense (4)
|
|
$
|
0.0
|
|
|
$
|
0.0
|
|
|
$
|
0.0
|
|
|
$
|
0.0
|
|
|
$
|
0.0
|
|
Change in working capital
|
|
($
|
2.5
|
)
|
|
($
|
2.2
|
)
|
|
($
|
1.6
|
)
|
|
($
|
1.0
|
)
|
|
($
|
0.7
|
)
|
Capital expenditures
|
|
($
|
0.6
|
)
|
|
($
|
0.7
|
)
|
|
($
|
0.7
|
)
|
|
($
|
0.7
|
)
|
|
($
|
0.8
|
)
|
Unlevered free cash flow
|
|
$
|
2.4
|
|
|
$
|
3.2
|
|
|
$
|
4.2
|
|
|
$
|
5.1
|
|
|
$
|
5.6
|
|
(1)
|
Public company costs assumed to be zero. For projections for the fiscal years 2012-2016 which included public company costs, see pages 50-52 of the Definitive Proxy
Statement.
|
(2)
|
Net interest costs assumed to be zero. For projections for the fiscal years 2012-2016 which included interest expense, see pages 50-52 of the Definitive Proxy
Statement.
|
(3)
|
Pro Forma taxes assumed to be 35% of income before tax.
|
(4)
|
Stock-based compensation expense assumed to be replaced by cash compensation. For projections for the fiscal years 2012-2016 which included stock-based compensation as
a non-cash expense, see pages 50-52 of the Definitive Proxy Statement.
|
Cautionary Statements Regarding Forward-Looking Information
Certain statements contained in this filing contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.
Such forward-looking statements include statements regarding the intent, belief or current expectations of the Company and members of its management team, as well as the assumptions on which such statements are based, and generally are identified by
the use of words such as anticipates, believes, estimates, expects, forecasts, intends, may, plans, projects, seeks,
should, targets, will, or similar expressions. Forward-looking statements involve assumptions, estimates, expectations, forecasts, goals, projections, risks and uncertainties. Forward-looking statements are not
guarantees of future performance and involve risks and uncertainties that actual results may differ materially from those contemplated by such forward-looking statements. Many of these factors are beyond the Companys ability to control or
predict. Such factors include, but are not limited to, any conditions imposed in connection with the merger contemplated by the Merger Agreement, approval of the Merger Agreement by the Companys stockholders, the satisfaction of various other
conditions to the completion of the merger contemplated by the Merger Agreement, the outcome of any legal proceedings that may be instituted against the Company related to the Merger Agreement, risks related to economic conditions as relate to the
Companys customer base, the collection of receivables from the Companys customers who may be affected by economic conditions, the highly competitive market in which the Company operates, rapid changes in technologies that may displace
products sold by the Company, declining prices of products, the Companys reliance on distributors, delays in product development efforts, uncertainty in consumer acceptance of the Companys products, changes in the Companys level of
sales or profitability, manufacturing and sourcing risks, availability of materials, cost of components for the Companys products, product defects and returns, and other factors discussed in the Companys Annual Report on Form 10-K for
the fiscal year ended August 31, 2011 filed with the SEC, and in all filings made by the Company with the SEC subsequent to the filing of the Form 10-K. These risks and uncertainties should be considered in evaluating any forward-looking
statements contained herein. These risks, as well as other risks associated with the merger, are more fully disclosed in the Definitive Proxy Statement that has been filed with the SEC in connection with the merger. Additional risks and
uncertainties are identified and discussed in the Companys reports filed with the SEC and available at the SECs website at www.sec.gov. Each forward-looking statement speaks only as of the date of the particular statement and the Company
does not undertake any obligation to update or revise such forward-looking statements, whether as a result of new information, future events or otherwise.
Additional Information and Where to Find It
In connection with the proposed merger and
required stockholder approval, the Company has filed the Definitive Proxy Statement with the SEC and has mailed the Definitive Proxy Statement to its stockholders. Investors and security holders are advised to read carefully and in their entirety
the Definitive Proxy Statement, as supplemented by the disclosures made in this document, and other relevant materials because such materials will contain important information about the Company and the proposed merger. Investors and security
holders may obtain free copies of these documents and other documents filed with the SEC at the SECs website at www.sec.gov. In addition, the documents filed by the Company with the SEC may be obtained free of charge by contacting the Company
at Corporate Secretary, RF Monolithics, Inc., 4441 Sigma Road, Dallas, Texas 75244. The Companys filings with the SEC are also available on our website at www.rfm.com.
Participants in the Solicitation
The Company and its directors, executive officers and other members of its management and employees may be deemed to be participants in the solicitation of proxies from the Companys stockholders
with respect to the proposed merger. Information regarding the interests of the Companys participants in the solicitation and their ownership of the Companys common stock is set forth in the Companys proxy statements and Annual
Reports on Form 10-K previously filed with the SEC, including the Definitive Proxy Statement related to the proposed merger. Investors and security holders may obtain more detailed information regarding the direct and indirect interests of the
Company and its officers and directors in the proposed merger by reading the Definitive Proxy Statement regarding the proposed merger. Investors and security holders may obtain free copies of these documents from the Company using the contact
information set forth above.
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