Upcoming/New CFIUS Filing: Marvell Technology Group and Cavium, Inc.
On November 19, 2017, California based semiconductor company Marvell Technology Group Ltd., offering storage, network infrastructure, and wireless connectivity solutions, entered into a merger agreement with semiconductor company Cavium, Inc., a Delaware corporation providing “solutions for compute, security, storage, switching, connectivity and baseband processing,” pursuant to which Cavium will become a wholly owned subsidiary of Marvell Technology Group. (See Marvell Technology Press Release, Marvell and Cavium to Combine Creating an Infrastructure Solutions Powerhouse, Nov. 20, 2017; Marvell Technology Group Ltd. Form 8-K, Nov. 20, 2017, SEC Filing.) The transaction will combine “Marvell’s portfolio of leading HDD and SSD storage controllers, networking solutions and high-performance wireless connectivity products with Cavium’s portfolio of leading multi-core processing, networking communications, storage connectivity and security solutions.” (Marvell Technology Press Release, Marvell and Cavium to Combine Creating an Infrastructure Solutions Powerhouse, Nov. 20, 2017.)
Under the agreement, CFIUS clearance is a condition to closing. (See Agreement and Plan of Merger, §§ 5.4, 6.7(b), Marvell Technology Group Ltd. Form 8-K, Ex-2.1, Nov. 2017, SEC Filing.) If the deal is terminated as a result of CFIUS blocking the transaction, failure to obtain CFIUS clearance by November 19, 2018, or because of a material of breach of obligations to obtain CFIUS clearance by Marvell Technology Group, then Marvell Technology Group may be obligated to pay Cavium a termination fee of $180 million. (See id., § 8.3(f)).