Siliconix Acquires Direct Control of Itzehoe Wafer Fabrication Facility, Expects To Establish 8-Inch Wafer Production Capability

Siliconix Acquires Direct Control of Itzehoe Wafer Fabrication Facility, Expects To Establish 8-Inch Wafer Production Capability

SANTA CLARA, Calif., Feb. 7 /PRNewswire-FirstCall/ -- Siliconix incorporated (NASDAQ:SILI), an 80.4% owned subsidiary of Vishay Intertechnology, Inc. (NYSE:VSH), announced today that Siliconix has acquired Vishay's former wholly-owned subsidiary, Vishay Semiconductor Itzehoe GmbH (VSIG). The purchase price of EUR7.5 million (approx. $10.2 million), which includes all assets and liabilities, was based on an independent appraisal performed on behalf of the Board of Directors of Siliconix, who approved the transaction. Siliconix also announced that it plans to establish 8-inch wafer production capability at the Itzehoe facility.

VSIG operates a Class 1 wafer fabrication facility in Itzehoe, Germany, under an agreement with Fraunhofer Gesellschaft. Vishay acquired its 80.4% interest in Siliconix and its 100% interest in VSIG concurrently, as part of the 1998 acquisition of the TEMIC Semiconductor Division of Daimler-Benz. Siliconix had a subcontracting agreement with VSIG.

In accordance with generally accepted accounting principles regarding transfers of assets between companies under common control, Siliconix will record the assets acquired and liabilities assumed at Vishay's net book value. Also in accordance with accounting principles for transfers of assets between companies under common control, the audited consolidated financial statements of Siliconix, which are expected to be issued in March 2005, will present the combined activities of Siliconix and VSIG (renamed "Siliconix Itzehoe GmbH") for all periods presented. The attached tables provide unaudited consolidated historical financial data for Siliconix and VSIG. The transaction will not have any impact on the consolidated results of Vishay.

Dr. King Owyang, President and Chief Executive Officer of Siliconix said, "This is an excellent transaction for Siliconix, providing us with the ability to control the Itzehoe fab. We are excited that we will be able to oversee the capital expansion at Itzehoe, which we expect will alleviate our capacity constraints for high-cell-density wafers and will provide us with our first 8- inch wafer production facility."

Siliconix is a leading manufacturer of power MOSFETs, power ICs, analog switches, and multiplexers for computers, cell phones, fixed communications networks, automobiles, and other consumer and industrial electronic systems. The Company's facilities include a Class 1 wafer fab dedicated to the manufacture of power products in Santa Clara, California, and an affiliated Class 1 wafer fab in Itzehoe, Germany. The Company's products are also fabricated by subcontractors in Japan, Germany, China, Taiwan, and the United States. Assembly and test facilities include a company-owned facility in Taiwan, a joint venture in Shanghai, China, and subcontractors in the Philippines, China, Taiwan and Israel.

Vishay Intertechnology, Inc., a Fortune 1,000 Company listed on the NYSE (VSH), is one of the world's largest manufacturers of discrete semiconductors (diodes, rectifiers, transistors, and optoelectronics) and selected ICs, and passive electronic components (resistors, capacitors, inductors, and transducers). Vishay's components can be found in products manufactured in a very broad range of industries worldwide. Vishay is headquartered in Malvern, Pennsylvania, and has operations in 17 countries employing over 26,000 people. Vishay can be found on the Internet at http://www.vishay.com/.

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On February 1, 2005, the Board of Directors of Siliconix approved the acquisition of Vishay Semiconductor Itzehoe GmbH ("VSIG") from Vishay, and renamed the company "Siliconix Itzehoe GmbH". Siliconix Itzehoe GmbH is now a wholly-owned subsidiary of Siliconix. This transaction has been accounted for as a merger of entities under common control and has been recorded in a manner similar to a pooling of interests. Accordingly, the unaudited consolidated financial data presented below have been adjusted to include the accounts of Siliconix and VSIG (collectively, the "Company") for all periods presented. Adjustments recorded to adjust previously reported financial statements consisted of those necessary to include the balances and results of VSIG and to eliminate intercompany balances, transactions between Siliconix incorporated and VSIG, and to record an equity adjustment for the purchase price.

The following unaudited tables present historical financial data for Siliconix incorporated and VSIG and the adjustments required to affect the merger of entities under common control similar to a pooling of interests:

Siliconix incorporated
Unaudited Pro Forma Condensed
Balance Sheet
(In thousands, except share amounts)
Eliminations
and
As Reported VSIG adjustments Pro Forma
10/2/2004 10/2/2004 10/2/2004 10/2/2004
Assets
Current assets $ 470,452 $ 6,493 $(2,958) $ 473,987
Property and equipment 145,851 20,635 - 166,486
Goodwill 7,445 - - 7,445
Other assets 25,657 - - 25,657
Total assets $ 649,405 $ 27,128 $(2,958) $ 673,575

Liabilities and Stockholders'
Equity
Current liabilities $ 97,138 $ 18,781 $(2,958) $ 112,961
Payable to Vishay for VSIG - - 10,200 10,200
Non-current liabilities 83,003 116 - 83,119
Total liabilities 180,141 18,897 7,242 206,280
Commitments and contingencies

Stockholders' equity 469,264 8,231 (10,200) 467,295
Total liabilities and
stockholders' equity $ 649,405 $ 27,128 $(2,958) $ 673,575


Siliconix incorporated
Unaudited Pro Forma Condensed
Operations Data
(In thousands, except for per
share information)

Eliminations
and
As Reported VSIG adjustments Pro forma
Nine Nine Nine Nine
months months months months
10/2/2004 10/2/2004 10/2/2004 10/2/2004

Net sales $ 354,283 $28,988 $(23,422) $ 359,849
Cost of products sold 241,674 28,656 (23,422) 246,908
Gross profit 112,609 332 - 112,941

Operating income 56,605 (88) - 56,517

Income before taxes and minority
interest 57,982 (429) - 57,553

Net income $ 45,085 $ (269) $ - $ 44,816

Net income per share (basic
and diluted) $ 1.51 $ (0.01) $ - $ 1.50


Siliconix incorporated
Unaudited Pro Forma Condensed
Statement of Cash Flows
(In thousands)
As Reported VSIG Pro Forma
Nine months Nine months Nine months
10/2/2004 10/2/2004 10/2/2004
Operating activities
Net income $ 45,085 $ (269) $ 44,816
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation and amortization 26,604 6,591 33,195
Prepayment to Tower
Semiconductor (20,000) - (20,000)
Other non-cash items 249 (44) 205
Changes in operating assets and
liabilities: 14,511 (2,909) 11,602
Net cash provided by operating
activities 66,449 3,369 69,818

Investing Activities (34,600) (3,369) (37,969)

Financing activities - - -

Effect of exchange rate changes on
cash and cash equivalents (1) - (1)

Net increase in cash and cash
equivalents 31,848 - 31,848

Cash and cash equivalents:
Beginning of period 279,464 1 279,465
End of period $ 311,312 $ 1 $ 311,313


Siliconix incorporated
Unaudited Pro Forma Condensed
Balance Sheet
(In thousands, except share
amounts)
Eliminations
and
As Reported VSIG adjustments Pro Forma
12/31/2003 12/31/2003 12/31/2003 12/31/2003
Assets
Current assets $ 448,237 $ 9,369 $ (2,978) $ 454,628
Property and equipment 144,091 24,163 - 168,254
Goodwill 7,445 - - 7,445
Other assets 1,397 - - 1,397
Total assets $ 601,170 $ 33,532 $ (2,978) $ 631,724

Liabilities and Stockholders'
Equity
Current liabilities $ 103,071 $ 24,566 $ (2,978) $ 124,659
Payable to Vishay for VSIG - - 10,200 10,200
Non-current liabilities 73,939 370 - 74,309
Total liabilities 177,010 24,936 7,222 209,168
Commitments and contingencies

Stockholders' equity 424,160 8,596 (10,200) 422,556
Total liabilities and
stockholders' equity $ 601,170 $ 33,532 $ (2,978) $ 631,724



Siliconix incorporated
Unaudited Pro Forma Condensed
Operations Data
(In thousands, except for per
share information)

Eliminations
and
As Reported VSIG adjustments Pro forma
Year ended Year ended Year ended Year ended
12/31/2003 12/31/2003 12/31/2003 12/31/2003

Net sales $ 392,064 $ 34,766 $ (28,738) $ 398,092
Cost of products sold 277,595 33,592 (28,738) 282,449
Gross profit 114,469 1,174 - 115,643

Operating income 49,008 622 - 49,630

Income before taxes and
minority interest 50,703 147 - 50,850

Net income $ 39,361 $ 92 $ - $ 39,453

Net income per share (basic
and diluted) $ 1.32 $ - $ - $ 1.32



Siliconix incorporated
Unaudited Consolidated Condensed
Pro Forma Statement of Cash Flows
(In thousands)
As Reported VSIG Pro Forma
Year Ended Year Ended Year Ended
12/31/2003 12/31/2003 12/31/2003
Operating activities
Net income $ 39,361 $ 92 $ 39,453
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation and amortization 37,461 7,932 45,393
Other non-cash items (33) (2,516) (2,549)
Changes in operating assets and
liabilities: 17,610 (3,603) 14,007
Net cash provided by operating
activities 94,399 1,905 96,304

Investing Activities
Puchase of property and equipment (26,984) (1,905) (28,889)
Net proceeds of short-term investment
with affiliate 75,000 - 75,000
Net cash provided by investing
activities 48,016 (1,905) 46,111

Financing activities 3 - 3

Effect of exchange rate changes on
cash and cash equivalents (36) - (36)

Net increase in cash and cash
equivalents 142,382 - 142,382

Cash and cash equivalents:
Beginning of period 137,082 1 137,083
End of period $ 279,464 $ 1 $ 279,465


Siliconix incorporated
Unaudited Pro Forma Condensed
Operations Data
(In thousands, except for per
share information)


Eliminations
As and
Reported VSIG adjustments Pro forma
Year ended Year ended Year ended Year ended
12/31/2002 12/31/2002 12/31/2002 12/31/2002

Net sales $ 372,944 $ 29,994 $(23,819) $ 379,119
Cost of products sold 257,765 27,906 (23,819) 261,852
Gross profit 115,179 2,088 - 117,267

Operating income 53,983 1,714 - 55,697

Income before taxes and
minority interest 59,411 342 - 59,753

Net income $ 46,156 $ 211 $ - $ 46,367

Net income per share (basic
and diluted) $ 1.54 $ 0.01 $ - $ 1.55


Siliconix incorporated
Unaudited Consolidated Condensed Pro
Forma Statement of Cash Flows
(In thousands)
As Reported VSIG Pro Forma
Year Ended Year Ended Year Ended
12/31/2002 12/31/2002 12/31/2002
Operating activities
Net income $ 46,156 $ 211 $ 46,367
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation and amortization 40,410 6,046 46,456
Other non-cash items 3,865 (2,944) 921
Changes in operating assets and
liabilities: (23,157) 304 (22,853)
Net cash provided by operating
activities 67,274 3,617 70,891

Investing Activities
Puchase of property and equipment (22,443) (3,618) (26,061)
Proceeds on sale of property and
equipment 64 - 64
Short-term investment with affiliate (75,000) - (75,000)
Net cash provided by investing
activities (97,379) (3,618) (100,997)

Financing activities - - -

Effect of exchange rate changes on
cash and cash equivalents (49) - (49)

Net increase in cash and cash
equivalents (30,154) (1) (30,155)

Cash and cash equivalents:
Beginning of period 167,236 2 167,238
End of period $ 137,082 $ 1 $ 137,083


Contact: Peter G. Henrici, Vice President
Investor Relations, Siliconix incorporated
(NASDAQ NSM: SILI)
408-567-8400

Robert A. Freece
Executive Vice President
Vishay Intertechnology, Inc.
610-251-5252



Source: Siliconix incorporated

CONTACT: Peter G. Henrici, Vice President, Investor Relations, Siliconix
incorporated, +1-408-567-8400; or Robert A. Freece, Executive Vice President,
Vishay Intertechnology, Inc., +1-610-251-5252

Web site: http://www.siliconix.com/


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