The Acquisition of Galvantech Inc. by Cypress Semiconductor Corporation

In March of 2000, Cypress Semiconductor Corp. purchased Galvantech Inc. in a stock swap of 3.26 million shares of Cypress stock for all of Galvantech’s outstanding stock and options. The acquisition was worth $43 million and helped to propel Cypress into the billion dollar revenue range. Founded in 1994 and based in Santa Clara, California, Galvantech specialized in ultra-high performance memory products particularly synchronous networking static random access memories (SRAMs). The addition of Galvantech’s technology allowed Cypress to augment its SRAM offerings, the segment which accounted for slightly more than half of Cypress’s 1999 revenues. Although the Galvantech acquisition gave a complementary boost to Cypress’ product portfolio, giving Cypress larger megabit and faster speed SRAMS, the SRAM market has been in considerable decline over the years. In 2001 the SRAM Total Available Market was nearly $4 billion, it is now just under $500 million in 2014 with annual losses averaging -13%. Cypress has been experiencing falling revenues ever since one of its largest customers, Intel, began integrating SRAMs directly into their microprocessors making standalone SRAMs redundant. In response, the company has increased its market share of SRAMs (from 9% to 38% from 2001 to 2013) but the market is unlikely to recover to its previous highs.

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