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FAQ: CMP Technology Acquisition of Semiconductor Insights
Who is CMP? CMP Technology is part of United Business Media (UBM), a $3 billion London-based global business media company that brings buyers and sellers together across targeted media channels—publications, events and online – with the information they need to do business successfully. UBM has a staff of 5,000 in more than 30 countries. Who is Semiconductor Insights? Semiconductor Insights (SI) is the leading technical advisor to the global microelectronics industry. SI supports its clients in asserting their intellectual property (IP) rights and developing and commercializing new technologies and products, through in-depth technical investigation of integrated circuits and electronic systems. Why was CMP interested in buying SI? What is the relationship/value between a media company and a technology company? CMP is currently transforming from a pure play media company to a next generation media and services company, with products like VirtuaLabs and eLearning platforms for engineers. SI brings a great deal of information to the market and CMP can help SI access a wider global audience. Why did SI decide to sell to CMP? SI has derived significant value from its four-year relationship with CMP including building the company’s analyst profile, penetrating new markets, and developing visibility within the C-suite of target accounts. SI’s leadership felt that joining forces with CMP would enable both companies to grow exponentially. As well, SI is very excited by the prospect to be able to help accelerate CMP’s transition to a next generation media and services company. How long has this acquisition been in the works? Discussions started approximately 12 months ago with SI's former President and CEO, Dr. Doug Smeaton, who passed away accidentally in February 2007. Why is SI good for CMP? Why is CMP good for SI? In the past two years, CMP has made a number of very successful acquisitions to grow its portfolio horizontally and vertically. SI will add a much-needed component to the Technology Innovators Group. What are the terms of the acquisition? UBM acquired SI for $26 million along with deferred consideration of up to $8 million subject to certain conditions. Where does SI fit into the CMP structure? SI will merge into the Technology Innovators Group, which is one of the largest divisions of CMP Technology, and spans across the Electronics, Software, Game, Call Center and Communications markets. What does CMP plan to do with SI? Will CMP assume full operational control of SI? SI will continue to operate and execute as a standalone business unit with no disruption. CMP and SI will be looking to create new innovative products and revenue streams. Why did CMP just layoff 200 people, and then buy SI, a company of 160 people? Will there be a reduction in SI’s workforce as a result of this acquisition? As mentioned above, CMP is engaged in a transformation process from a pure play media company to next generation media and services company focused on digital and face to face media. CMP has acquired 13 companies and launched 50 organic products in the past 2 years to accelerate this transformation. Unfortunately, there are casualties in transformation and this was the case recently at CMP. How does this acquisition impact CMP’s strategy? Of all SI’s capabilities, what is key to CMP’s go forward strategy? All of SI's capabilities are key from R&D and engineering to sales and marketing. We will be launching events in the IP area and promoting TECHinsights reports. Will SI continue to sell products and services as they do today? Will CMP sell SI’s products/services? Not directly, although CMP web links and promotion will help. What does this mean for SI’s clients? Outstanding commitments? It's business as usual. But clients can look forward to new and innovative products. Do SI and CMP have any joint customers? Yes, although the corporate departments and budgets are very different. CMP sells mainly to marketing departments at semiconductor and microelectronics companies. SI sells mainly to legal and engineering teams at semiconductor and electronics companies. Will the acquisition create conflicts for SI? For CMP? No. The IP division will be "walled off" and all privacy agreements rigorously enforced. Will SI’s name and brand continue to exist? Yes – Semiconductor Insights is a strong brand. Does CMP plan to acquire any other technology companies? SI competitors? Yes, CMP is actively looking at synergistic acquisitions, but not SI competitors. Who will be the President/CEO of SI (or equivalent)? CMP has conducted a search for a new company leader and will announce as soon as the appointment is confirmed. Will there be changes to the SI Management Team? How will SI be structured within CMP? SI’s existing Management Team will remain in place. CMP will appoint a leader of SI to fill the vacancy created by the accidental death of the company’s President and CEO, Dr. Doug Smeaton. SI will report through the Technology Innovators Group at CMP Technology within the Electronics Division. Is this just another example of a Canadian technology company being bought out by a US conglomerate? As a technology services company, SI’s value is intrinsically tied to its employees. CMP is investing in SI, its employees and facilities, and, in effect, in Canada. This will be CMP’s first Canadian operation and its third largest office. Where can I get more information on CMP’s acquisition of SI? More information is available on both SI’s and CMP’s websites. Please direct specific enquiries to the following media contacts: What are UBM’s and CMP’s web addresses? www.unitedbusinessmedia.com
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