v2.4.0.8
Subsequent Event
3 Months Ended
Sep. 30, 2013
Subsequent Events [Abstract]  
Subsequent Event

14. Subsequent Event

On October 9, 2013, we signed a definitive agreement to acquire a privately held company, Validity Sensors, Inc., or Validity, a leading provider of biometric fingerprint authentication solutions for smartphones, tablets, and notebooks. The transaction has been approved by our board of directors and Validity’s board of directors and is subject to customary closing conditions. There are no financing contingencies related to the acquisition. The transaction is expected to close in the second quarter of fiscal 2014. With this acquisition we expect to gain access to the fast growing biometrics market, significantly expanding our market opportunity and underscoring our commitment to making smart devices easier to use. The acquisition is expected to be completed by acquiring all capital stock and other vested and unvested equity interests of Validity for an aggregate base purchase price of $92.5 million. In addition, we may become obligated to make earn-out consideration payments of up to an additional $162.5 million, which is based primarily on sales, during certain time periods, ending on March 31, 2016, of certain products embodying Validity fingerprint sensor technology. The earn-out consideration will generally be payable in cash, but there are certain conditions that require payout of a portion of the earn-out consideration, if any, in our common stock. Pursuant to the merger agreement we expect to create a merger sub wholly owned by us that will be merged with and into Validity, with Validity surviving as our wholly owned subsidiary, and as part of the same overall transaction, Validity will then merge with and into another merger sub wholly owned by us, with such other merger sub surviving such merger as our wholly owned subsidiary. Pursuant to the Merger, the Company incurred approximately $1.0 million in direct acquisition costs during the September quarter which were expensed as incurred.

The acquisition will be accounted for using the purchase method of accounting in accordance with the business acquisition guidance. Under the purchase accounting method, the total estimated purchase consideration of the acquisition will be allocated to the tangible and identifiable intangible assets acquired and liabilities assumed based on their relative fair values. The excess of the purchase consideration over the net tangible and identifiable intangible assets acquired and liabilities will be recorded as goodwill.