Pixelworks, Inc. (NASDAQ: PXLW) has entered into a definitive agreement to acquire ViXS Systems Inc. (TSX: VXS) in an all-stock transaction consisting of approximately 3.7 million shares of Pixelworks common stock valued at approximately CDN $28.7 million or US $20.2 million.
Each share of ViXS Systems will be exchanged for 0.04836 of a share of Pixelworks’ common stock. The exchange ratio is equivalent to consideration of US $0.26 per ViXS common share, based on the closing price of Pixelworks on May 17, 2017.
Celtic House Venture Partners and New Enterprise Associates (NEA) are two largest shareholders, controlling 16.6% and 12.3% of ViXS Systems outstanding shares respectively.
Pixelworks’ legal counsel are Pillsbury Winthrop Shaw Pittman LLP in the U.S. and Stikeman Elliott LLP in Canada, and ViXS’s legal counsel is Gowling WLG in Canada and David Wright Tremaine in the U.S. Needham & Company is acting as financial advisor to ViXS.
“Today’s announced acquisition of ViXS represents a unique opportunity to strengthen our position as a known technology leader with extensive visual and video processing expertise. In addition to adding highly complementary technology and product offerings, the transaction is expected to provide the potential to meaningfully accelerate the development of comprehensive end-to-end video streaming solutions. Similar to Pixelworks, ViXS has a long heritage in visual processing solutions with a team of engineers that have deep technical expertise. ViXS divested its legacy MoCA business earlier this year and narrowed its strategic focus to efficient delivery solutions for high-quality video, including best-in-class transcoding and decoder technologies,” said Todd DeBonis, President & CEO of Pixelworks.
“This transaction represents a compelling opportunity to achieve greater scale and market penetration with our best-in-class UHD/HDR solutions for Consumer and Video Delivery Infrastructure market segments. Additionally, Pixelworks’ acquisition of ViXS is expected to provide not only world class engineering and technology, but a joint platform to monetize industry-leading innovation into significant value to our customers, employees and shareholders,” added Sohail Khan, President & CEO of ViXS.
photo credit: ViXS Systems