SONY SLM deal paved way for Cypress buy

Less than two weeks after the mid-July announcement by Silicon Light Machines (SLM; Sunnyvale, CA) that Sony (Tokyo, Japan) had bought an exclusive license for the SLM grating-light-valve (GLV) technology for display applications, Cypress Semiconductor (San Jose, CA) announced a definitive agreement to purchase SLM. The estimated $180 million deal, announced at the end of last month, involves the issuance of 3.7 million shares of Cypress stock in exchange for all outstanding stock and options of SLM.

The acquisition follows a two-year manufacturing relationship between Cypress and SLM and the inclusion last year of Cypress president and CEO T. J. Rodgers on the SLM board, along with a $2.25 million investment by Cypress in SLM for a 5% share of the company. The sizable Sony deal this year, however, provided a strategic window for Cypress to acquire SLM without losing any momentum, according to Rodgers. Semiconductor manufacturer Cypress has been making optical components in its Round Rock, TX, fab for SLM since 1998. Cypress started investing in SLM last year on realizing the potential of the SLM microelectromechanical system technology (which had already proven compatible with manufacturing processes at Cypress) for providing a highly competitive optical dimension to Cypress' established and growing focus on data and telecommunications.—Hassaun Jones-Bey, Senior Editor