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Sivers Semiconductors Enters into Letter of Intent With byNordic Acquisition Corporation for Business Combination of Sivers' Photonics Subsidiary

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Sivers Semiconductors AB has entered a non-binding letter of intent to merge its Sivers Photonics subsidiary with byNordic Acquisition (BYNO), a publicly-traded special purpose acquisition company. This merger aims to create a standalone, US NASDAQ traded Photonics company with significant cash reserves. Sivers Photonics, a leading supplier of semiconductor photonic devices, focuses on indium phosphide (InP) laser sources for AI infrastructure and sensing applications.

The transaction is expected to unlock value and bring Sivers Photonics closer to the US AI ecosystem, where it currently generates 80% of its net revenue. The merger is subject to due diligence, definitive documentation, and necessary approvals. Post-merger, Sivers plans to hold majority ownership in the combined publicly listed company, with headquarters in Silicon Valley, CA.

Sivers Semiconductors AB ha firmato una lettera d'intenti non vincolante per fondere la sua sussidiaria Sivers Photonics con byNordic Acquisition (BYNO), una società di acquisizione a scopo speciale quotata in borsa. Questa fusione ha l'obiettivo di creare un'azienda di fotonica indipendente, quotata nel NASDAQ statunitense, con riserve di liquidità significative. Sivers Photonics, fornitore leader di dispositivi fotonici a semiconduttore, si concentra su fonti laser in fosfuro d'indio (InP) per infrastrutture AI e applicazioni di sensing.

Si prevede che la transazione sbloccherà valore e avvicinerà Sivers Photonics all'ecosistema AI statunitense, dove attualmente genera l'80% del suo fatturato netto. La fusione è soggetta a due diligence, documentazione definitiva e approvazioni necessarie. Dopo la fusione, Sivers prevede di mantenere la maggioranza delle partecipazioni nella società pubblica combinata, con sede nella Silicon Valley, CA.

Sivers Semiconductors AB ha entrado en una carta de intención no vinculante para fusionar su subsidiaria Sivers Photonics con byNordic Acquisition (BYNO), una compañía de adquisición de propósito específico que cotiza en bolsa. Esta fusión tiene como objetivo crear una empresa de fotónica independiente, cotizada en el NASDAQ de EE. UU., con reservas de efectivo significativas. Sivers Photonics, un proveedor líder de dispositivos fotónicos semiconductores, se centra en fuentes láser de fosfuro de indio (InP) para infraestructura de IA y aplicaciones de detección.

Se espera que la transacción desbloquee valor y acerque a Sivers Photonics al ecosistema de IA de EE. UU., donde actualmente genera el 80% de sus ingresos netos. La fusión está sujeta a la debida diligencia, documentación definitiva y aprobaciones necesarias. Después de la fusión, Sivers planea mantener la mayoría de la propiedad en la empresa combinada que cotiza en bolsa, con sede en Silicon Valley, CA.

Sivers Semiconductors AB는 Sivers Photonics 자회사byNordic Acquisition (BYNO)와 합병하기 위한 비구속 의향서를 체결했습니다. 이 합병의 목표는 미국 NASDAQ에 상장된 독립적인 포토닉스 회사를 만드는 것으로, 상당한 현금 보유를 갖추게 됩니다. Sivers Photonics는 반도체 포토닉 장치의 선두 공급업체로서 AI 인프라 및 센싱 응용 분야를 위한 인듐 인화물 (InP) 레이저 소스에 중점을 두고 있습니다.

이번 거래는 가치를 창출하고 Sivers Photonics를 현재 순수익의 80%를 생성하고 있는 미국 AI 생태계에 더 가깝게 다가가게 할 것으로 예상됩니다. 합병은 실사, 최종 문서화 및 필요한 승인을 거쳐야 합니다. 합병 후 Sivers는 결합된 상장 회사에서 과반수 소유권을 보유할 계획이며, 본사는 실리콘 밸리, CA에 위치할 것입니다.

Sivers Semiconductors AB a signé une lettre d'intention non contraignante pour fusionner sa société sœur Sivers Photonics avec byNordic Acquisition (BYNO), une société d'acquisition à but spécifique cotée en bourse. Cette fusion vise à créer une entreprise de photonique autonome cotée sur le NASDAQ américain, dotée de réserves de trésorerie significatives. Sivers Photonics, un fournisseur leader de dispositifs photoniques à semi-conducteurs, se concentre sur des sources laser en phosphure d'indium (InP) pour les infrastructures d'IA et les applications de détection.

La transaction devrait débloquer de la valeur et rapprocher Sivers Photonics de l'écosystème IA américain, où elle génère actuellement 80 % de son chiffre d'affaires net. La fusion est soumise à une diligence raisonnable, à la documentation définitive et aux approbations nécessaires. Après la fusion, Sivers prévoit de conserver la majorité des parts dans l'entreprise combinée cotée, dont le siège sera situé dans la Silicon Valley, CA.

Sivers Semiconductors AB hat einen nicht verbindlichen Letter of Intent unterzeichnet, um ihre Sivers Photonics Tochtergesellschaft mit byNordic Acquisition (BYNO), einer an der Börse notierten Special Purpose Acquisition Company, zu fusionieren. Diese Fusion zielt darauf ab, ein eigenständiges Photonik-Unternehmen, das an der US NASDAQ gehandelt wird, mit erheblichen Barreserven zu schaffen. Sivers Photonics, ein führender Anbieter von photonischen Halbleitergeräten, konzentriert sich auf Indiumphosphid (InP) Laserquellen für KI-Infrastrukturen und Sensoranwendungen.

Die Transaktion wird voraussichtlich Werte freisetzen und Sivers Photonics näher an das US-KI-Ökosystem bringen, wo derzeit 80 % des Nettoumsatzes erzielt werden. Die Fusion unterliegt einer Due Diligence, einer endgültigen Dokumentation und erforderlichen Genehmigungen. Nach der Fusion plant Sivers, die Mehrheitsbeteiligung an dem kombinierten börsennotierten Unternehmen zu halten, dessen Hauptsitz in Silicon Valley, CA sein wird.

Positive
  • Sivers Photonics has development contracts with leading SiPh providers like Ayar Labs
  • Wireless business net revenue grew 155% in 2023, reaching approximately $15 million
  • Estimated total addressable market for chip-to-chip connectivity of $5 billion by 2027
  • SiPh technology offers up to 90% reduction in power consumption compared to copper wire solutions
  • A single customer has invested over $18M in development contracts with Sivers Photonics
Negative
  • The transaction is subject to due diligence and various approvals, which may delay or prevent completion
  • The merger requires securing concurrent financing, which may be challenging
  • Potential integration challenges and costs associated with establishing new headquarters in Silicon Valley

Insights

This merger represents a significant strategic move for Sivers Semiconductors. By spinning off Sivers Photonics and merging it with byNordic, they're creating a standalone entity focused on the high-growth photonics market, particularly in AI infrastructure and sensing applications. This could unlock substantial value, as the photonics business was potentially undervalued within the larger Sivers structure.

The deal provides Sivers Photonics with access to U.S. capital markets and brings it closer to its primary customer base, with 80% of its revenue already coming from the U.S. This could accelerate growth and improve its competitive position. For Sivers Semiconductors, this allows them to focus on their rapidly growing wireless business, which saw 155% net revenue growth in 2023, reaching approximately $15 million.

While the financial terms aren't disclosed, the potential market opportunity is substantial. The chip-to-chip connectivity market for AI is estimated to reach $5 billion by 2027, with Sivers Photonics targeting a $1 billion served addressable market. This presents significant growth potential for the new entity.

The merger highlights the growing importance of photonics in addressing AI infrastructure challenges. Silicon photonics (SiPh) is emerging as a important technology for data centers, offering faster data transmission, lower latency and up to 90% reduction in power consumption compared to traditional copper wire solutions. This is particularly significant given the projected increase in data center electricity consumption, which could reach 9% of total U.S. electricity generation by 2030.

Sivers Photonics' focus on indium phosphide (InP) laser sources positions it well in this market. Their technology, backed by 25+ years of R&D and a strong patent portfolio, is particularly suited for AI applications. The company's existing relationships with leading SiPh providers and ongoing discussions with major AI companies, including hyperscalers, suggest strong market validation for their technology.

The planned Silicon Valley headquarters will likely enhance collaboration opportunities with tech giants and startups in the AI ecosystem, potentially accelerating innovation and market adoption of Sivers Photonics' solutions.

This merger taps into two significant market trends: the explosive growth of AI infrastructure and the increasing demand for advanced biometric sensors in consumer healthcare. The AI chip market is projected to see substantial growth, with an estimated 18 million GPUs for generative AI expected to be sold in the coming years. This creates a massive opportunity for Sivers Photonics' chip-to-chip connectivity solutions.

In the consumer healthcare sector, Sivers Photonics has already secured over $18 million in development contracts from a single customer for biometric sensor lasers. This early-mover advantage in a nascent market could translate into significant future revenue streams as wearable healthcare products proliferate.

The spin-off could also benefit Sivers' wireless business by allowing it to focus on its rapidly growing mmWave solutions for satellite and 5G markets. With multiple contracts and design wins already secured, this business is poised for significant product revenue growth over the next 3-5 years.

Overall, this strategic move positions both entities to capitalize on their respective high-growth markets more effectively.

Merger Expected to Unlock Significant Value and Create Independent US NASDAQ traded Photonics Company

KISTA, Sweden, Aug. 6, 2024 /PRNewswire/ -- Sivers Semiconductors AB (STO: SIVE), a leading supplier of integrated chips and photonics modules for the most advanced communications and sensor solutions, today announced that the Company has entered into a non-binding letter of intent (the "LOI") to merge its Sivers Photonics Ltd subsidiary ("Sivers Photonics") with byNordic Acquisition Corporation ("byNordic", Nasdaq: BYNO), a publicly-traded special purpose acquisition company. The proposed transaction would create a standalone, publicly traded photonics company that will be funded by significant cash reserves upon completion of the de-SPAC process.

Sivers today consists of two distinct wholly owned subsidiaries addressing two different markets: Wireless and Photonics. The Sivers' Photonics subsidiary is one of the world's advanced suppliers of semiconductor photonic devices. With a particular focus on indium phosphide (InP) laser sources, Sivers Photonics develops customizable lasers aimed at high-growth artificial intelligence infrastructure and sensing applications for data centers, consumer healthcare and automotive LIDAR.

The Sivers' Photonics subsidiary has developed a unique portfolio of technologies underpinned by 25+ years of research and development and has 80 employees, including 12 PhDs. The company has three issued patents and 16 patents pending across the US, UK, Canada and the World Intellectual Property Organization. Additionally, Sivers Photonics currently has development contracts to develop unique, high-performance lasers for several leading SiPh providers, such as Ayar Labs, and is in discussion with several leading AI companies, including hyperscalers.

Subsequent to the proposed spin-off and Sivers Photonics merger combination, Sivers remaining wireless business will consist of a portfolio of leading products in mmWave beamformer front-end integrated circuits, RF transceivers, repeaters, and software algorithms for optimum mmWave RF performance for satellite and 5G Infrastructure. Wireless business net revenue growth was 155 percent in 2023, reaching approximately $15 million. These markets are developing rapidly, and Sivers has secured a number of contracts and design wins that are projected to drive significant product revenue growth over the next 3-5 years.

Sivers Photonics is a leading company within tunable multi-wavelength lasers for direct on-chip integration. According to industry research, the number of sold GPUs for generative AI will grow substantially to approximately 18 million units, which management estimates will result in a total addressable market for chip-to-chip connectivity of $5 billion and a served addressable market of up to $1 billion by 2027. Demand for Artificial Intelligence applications is projected to require staggering increases in processing capability and energy consumption. According to Electric Power Research Institute, data centers could use up to 9% of total electricity generated in the United States by the end of the decade, more than doubling the current consumption. The application of silicon photonics, or SiPh, for data centers is the leading solution with the capacity to deliver the chip-to-chip connectivity needed to remove the bottlenecks for generative AI, while significantly reducing energy consumption. SiPh moves data with light rather than electrons in copper wire, resulting in faster data transmission, lower latency, and up to 90% reduction in power consumption compared to copper wire solutions.

Additionally, consumer biometric sensors using photonic lasers are enabling innovative wearable healthcare products for new applications ranging from tracking personal fitness to monitoring human biometrics and point-of-care solutions. Over the past few years, a single customer has invested over $18M in development contracts with Sivers Photonics to refine and optimize lasers for biometric sensors. While this market remains in its early stages of development, Sivers Photonics' deep R&D expertise has created a unique competitive advantage in supplying sophisticated photonic bio-sensors to this growing market.

"We believe the potential for AI Photonics is immense yet overshadowed by the equally exciting Sivers' Wireless business unit. With the attractive opportunity for silicon photonics in AI infrastructure and the emerging demand for photonic biometric sensors, we feel now is the right time to shine a light on this business unit as a standalone entity to gain access to the U.S. capital markets and create an opportunity for our shareholders to participate in its potential future success," said Bami Bastani, Sivers Semiconductor Chairman. "At the same time, we also look to capitalize on the success of the Sivers' Wireless business unit and the demand for our leading-edge mmWave beamformer solutions for satellite and 5G, which has gained substantial traction with customers in these developing markets over the last several years, enabling us to create a fully fabless and less capital-intensive company that will remain listed under Sivers Semiconductors AB."

This transaction is expected to unlock significant value and create an independent U.S.-listed entity, which will bring Sivers Photonics closer to investors, customers, and partners within the US AI ecosystem. Sivers Photonics currently has approximately 80% of its net revenue in the U.S.

Under the terms of the non-binding LOI, byNordic and Sivers intend to enter into a definitive agreement for the acquisition of Sivers Photonics. The completion of the business combination is subject to the completion of due diligence, the negotiation and execution of definitive documentation and satisfaction of the conditions contained therein, including (i) securing certain concurrent financing, (ii) completion of any required stock exchange and regulatory reviews and (ii) approval of the transaction by byNordic's and Sivers Photonics' Boards of Directors and stockholders. The terms of the proposed transaction provide that Sivers Photonics would be spun out and merged with byNordic, with the former equity holders of both Sivers Photonics and byNordic (following the completion of the Business Combination) holding equity in the combined publicly listed company, with Sivers holding majority ownership in the combined publicly listed company. Once the merger is finalized, the company plans to establish headquarters in Silicon Valley, CA with the manufacturing operations remaining in the U.K.

Sivers management will update this announcement when further clarity on these issues is achieved. In the interim, Sivers management will provide no further comment beyond what is described in the press release, given the sensitivity of the negotiations.

Setterwalls and Pillsbury Winthrop Shaw Pittman LLP are serving as legal counsel for Sivers Semiconductors.  Loeb & Loeb LLP is serving as legal counsel for byNordic Acquisition Corporation.

Forward-looking statements:

The information provided herein may include forward-looking statements within the meaning of Section 27A of the U.S. Securities Act of 1933 and Section 21E of the U.S. Securities Exchange Act of 1934, as amended. Such statements include but are not limited to statements regarding Sivers Semiconductors' plans, strategies, goals and business prospects; the terms and conditions of the proposed transaction; the timing of the execution of definitive transaction documents; the anticipation that the proposed transaction will occur; the anticipated benefits of the proposed transaction Sivers Semiconductors and its stockholders as well as to Sivers Photonics; as well as the anticipated business prospects and market trends for Sivers Photonics and its products. These forward-looking statements are based on management's current expectations, estimates, forecasts, and projections about Sivers Semiconductors and Sivers Photonics and are subject to risks and uncertainties that could cause actual results and events to differ materially from those stated in the forward-looking statements, including without limitation, the following: (a) the risks related to the proposed transaction, including without limitation the failure to successfully negotiate or execute definitive transaction agreements, termination of the definitive agreement prior to closing, failure to achieve any of the anticipated closing conditions to the proposed transaction or to fully realize the anticipated benefits of such a transaction, even if the potential transaction occurs, diversion of management's time and attention from our remaining businesses to the divestment of Sivers Photonics, third party costs incurred by us related to any such transaction, and risks associated with any liabilities related to the transaction or any such assets or business that are retained by Sivers Semiconductors in any sale transaction; (b) risks and uncertainties related to current expectations with respect to the combined businesses of Sivers wireless business and Sivers Photonics prior to the transaction and after the transaction, if it is consummated; and (c) other risks and uncertainties discussed in the other public disclosures available from Sivers Semiconductors. Forward-looking statements contained in this press release are made only as of the date hereof, and Sivers Semiconductors undertakes no obligation to update or revise the forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law.

For more information, please contact:
Dr. Bami Bastani, Chairman of the Board
Tel: +1 908 87 28 370
E-mail: bami.bastani@sivers-semiconductors.com

byNordic Investor Relations Contact:
Shelton Group Leanne K. Sievers | Joel Achramowicz
E-mail: sheltonir@sheltongroup.com

This disclosure contains information that Sivers Semiconductors is obliged to make public pursuant to the EU Market Abuse Regulation (EU nr 596/2014). The information was submitted for publication, through the contact person set out, on August 6, 2024, 22:30CET.

Sivers Semiconductors AB (SIVE.ST) is a leader in SATCOM, 5G, 6G, Photonics, and Silicon Photonics that drives innovation in global communications and sensor technology. Our business units, Photonics and Wireless, supply cutting-edge, integrated chips and modules critical for high-performance gigabit wireless and optical networks. Catering to a broad spectrum of industries from telecommunication to aerospace, we fulfill the increasing demand for computational speed and AI application performance, replacing electric with optical connections for a more sustainable world. Our wireless solutions are forging paths in advanced SATCOM/5G/6G systems, while our photonics expertise is revolutionizing custom semiconductor photonic devices for optical networks and optical sensing, making us a trusted partner to Fortune 100 companies as well as emerging unicorns. With innovation at our core, Sivers Semiconductors is committed to delivering bespoke, high-performance solutions for a better-connected and safer world. Discover our passion for perfection at www.sivers-semiconductors.com.

 

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FAQ

What is the purpose of Sivers Semiconductors' merger with byNordic Acquisition (BYNO)?

The merger aims to create an independent US NASDAQ traded Photonics company, unlocking significant value and bringing Sivers Photonics closer to investors, customers, and partners within the US AI ecosystem.

What are the main products and focus areas of Sivers Photonics?

Sivers Photonics specializes in indium phosphide (InP) laser sources, developing customizable lasers for high-growth artificial intelligence infrastructure and sensing applications in data centers, consumer healthcare, and automotive LIDAR.

How much did Sivers' Wireless business revenue grow in 2023?

Sivers' Wireless business net revenue grew by 155% in 2023, reaching approximately $15 million.

What is the estimated market size for chip-to-chip connectivity by 2027?

Management estimates a total addressable market for chip-to-chip connectivity of $5 billion and a served addressable market of up to $1 billion by 2027.

Where will the headquarters of the merged company be located?

Once the merger is finalized, the company plans to establish headquarters in Silicon Valley, CA, with manufacturing operations remaining in the U.K.

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