STMicroelectronics acquires majority stake in gallium nitride innovator Exagan

China, March 6, 2020 – STMicroelectronics (ST; NYSE: STM), a leading global supplier of semiconductors across multiple Electronic applications, announced that it has signed an agreement to acquire French GaN ( GaN) acquisition agreement for a majority stake in the innovative company Exagan Corporation. Exagan’s epitaxy process, product development and application experience will broaden and advance ST’s automotive, industrial and consumer power GaN development programs and businesses. Exagan will continue to execute on its existing product development program and ST will provide support for its deployment.

The terms of the transaction between the two parties have not been announced to the public, and the transaction will be completed after the French government approves it in accordance with the customary transaction regulations. The M&A agreement, which has now been signed, also provides that STMicroelectronics has the right to acquire the remaining minority stake in Exagan 24 months after the closing of the majority stake acquisition transaction. This transaction will be paid in available cash.

Jean-Marc Chery, President and CEO of STMicroelectronics, said: “ST’s silicon carbide is gaining momentum, and now we are expanding our commitment to another promising compound, gallium nitride, to advance automotive , industrial and consumer market customers adopt GaN power products. The acquisition of a majority stake in Exagan is another new move to strengthen the company’s leadership in the global power semiconductor market and our GaN long-term plan, ecosystem and business Complements the development project with CEA-Leti in Tours, France and the recently announced partnership with TSMC.”

Gallium nitride (GaN) belongs to a family of wide band gap (WBG) materials that includes silicon carbide. GaN-based devices are a major advancement in the high-frequency power electronic device industry. Their energy efficiency and power density are higher than those of silicon-based transistors. GaN-based devices save energy and power, and reduce the overall size of the system. GaN devices are suitable for a variety of applications, such as power factor correction and DC/DC converters for servers, telecom and industrial; on-board chargers and DC-DC converters for electric vehicles, and personal electronics applications such as power adapters.

Exagan was founded in 2014 and is headquartered in Grenoble, France. The company is committed to advancing the power electronics industry’s transition from silicon-based technology to GaN-on-silicon technology, developing smaller, more energy-efficient power converters. Exagan’s GaN power switches are designed for standard 200mm wafers.

Forward-Looking Statements Risk Warning

Safe Harbor Statement of the Private Securities Litigation Reform Act of 1995: Any statements set forth above that are not historical facts are forward-looking statements, including any statements regarding our future results of operations and financial condition, business strategy, future business plans and objectives, involve risks and uncertainties that could cause actual results to differ materially from the forward-looking statements. These statements are forecasts only, reflect our current views and projections about future events, are based on assumptions, are subject to risks and uncertainties, and are subject to change at any time. Potential risks and uncertainties include, but are not limited to, the following factors: the possibility of the transaction not being completed, including the failure of the transaction due to any pre-conditions; the risk that the expected benefits of the acquisition may not be realized; difficulties in retaining Exagan employees after the acquisition; facility expansion, Difficulty transferring manufacturing processes and know-how; risks that force management to focus on managing the business; and competitive effects and other risk factors related to our industry and business that we may detail from time to time in our SEC filings.