8-K/A
true 0001058057 0001058057 2019-12-06 2019-12-06

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington D.C. 20549 

 

FORM 8-K/A

 

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of report (date of earliest event reported): December 6, 2019

 

MARVELL TECHNOLOGY GROUP LTD.

(Exact name of registrant as specified in its charter)

 

Bermuda

 

000-30877

 

77-0481679

(State or other jurisdiction

of incorporation)

 

(Commission

File No.)

 

(IRS Employer

Identification No.)

Canon’s Court

22 Victoria Street

Hamilton HM 12

Bermuda

(Address of principal executive offices)

(441) 296-6395

(Registrant’s telephone number, including area code)

N/A

(Former name or former address, if changed since last report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the Registrant under any of the following provisions:

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

 

Trading

Symbols(s)

 

Name of each exchange

on which registered

Common Shares

 

MRVL

 

The Nasdaq Stock Market, LLC

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company  

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  

 

 


Explanatory Note

On December 6, 2019, Marvell Technology Group Ltd. (the “Company”), filed a Current Report on Form 8-K (the “Original 8-K”) disclosing, among other things, pursuant to Item 2.01 of Form 8-K that the Company had completed its divestiture pursuant to which it sold to NXP certain assets related to its Wi-Fi connectivity business.

This Amendment No. 1 to the Original 8-K (this “Amendment”) is being filed for the purpose of satisfying the Company’s undertaking to file the pro forma financial information required by Item 9.01 of Form 8-K, and this Amendment should be read in conjunction with the Original 8-K. Except as set forth herein, no modifications have been made to information contained in the Original 8-K.

Item 9.01. Financial Statements and Exhibits.

(b) Pro Forma Financial Information.

Unaudited pro forma condensed consolidated financial information as of November 2, 2019 and for the nine months ended November 2, 2019 and the fiscal year ended February 2, 2019 is attached hereto as Exhibit 99.1.

(d) Exhibits.

Exhibit
No.

   

Description of Exhibit

         
 

99.1

   

Unaudited pro forma condensed consolidated financial information

         
 

104

   

Cover Page Interactive Data File (embedded within the Inline XBRL document)


SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Dated: December 6, 2019

 

 

MARVELL TECHNOLOGY GROUP LTD.

             

 

 

By:

 

/s/ Mitchell Gaynor

 

 

Name:

 

Mitchell Gaynor

 

 

Title:

 

Executive Vice President, Chief

Administration and Legal Officer

and Secretary

EX-99.1

Exhibit 99.1

Marvell Technology Group LTD.

Unaudited Pro Forma Condensed Consolidated Financial Statements

On May 29, 2019, the Company announced its intent to sell its Wi-Fi connectivity business to NXP USA, Inc. for $1.76 billion in cash. At this time, the Company determined that the Wi-Fi Connectivity business met the held for sale criteria, as prescribed by FASB ASC 360-10-45-9, but did not meet the criteria to qualify as a discontinued operation. As such, the assets and liabilities of the Wi-Fi Connectivity business were presented as "Assets held for sale" and "Liabilities held for sale" in the Company's condensed consolidated balance sheet as of November 2, 2019, as filed within the Form 10-Q filed with the SEC on December 4, 2019.

On December 6, 2019, the Company completed the disposition. The disposition constituted a significant disposition for purposes of Item 2.01 of Form 8-K. As a result, the Company prepared the accompanying unaudited pro forma condensed consolidated financial statements in accordance with Article 11 of Regulation S-X.

The accompanying unaudited pro forma condensed consolidated balance sheet as of November 2, 2019, gives effect to the disposition as if the transaction occurred on November 2, 2019. The accompanying unaudited condensed consolidated statements of income for the year ended February 2, 2019 and for the nine months ended November 2, 2019, give effect to the disposition as if the transaction had occurred on February 4, 2018. The pro forma adjustments are described in the accompanying notes and are based upon information and assumptions available at the time of the filing of this Current Report on Form 8-K.

The unaudited pro forma financial information is based on financial statements prepared in accordance with U.S. generally accepted accounting principles, which are subject to change and interpretation. The unaudited pro forma condensed consolidated financial statements were based on and derived from our historical consolidated financial statements, adjusted for those amounts which were determined to be directly attributable to the disposition, factually supportable, and with respect to the unaudited pro forma condensed consolidated statements of income, expected to have a continuing impact on our consolidated results. Actual adjustments, however, may differ materially from the information presented. In addition, the unaudited pro forma financial information is based upon available information and assumptions that management considers to be reasonable, and such assumptions have been made solely for purposes of developing such unaudited pro forma financial information for illustrative purposes in compliance with the disclosure requirements of the SEC. The unaudited pro forma financial information is not necessarily indicative of what the financial position or income statement results would have actually been had the disposition occurred on the dates indicated. In addition, these unaudited pro forma condensed consolidated financial statements should not be considered to be indicative of our future consolidated financial performance and income statement results.

The unaudited pro forma condensed combined financial statements have been developed from and should be read in conjunction with the Company’s historical audited consolidated financial statements and accompanying notes contained in the Company’s Annual Report on Form 10-K for its fiscal year ended February 2, 2019, and Quarterly Report on Form 10-Q as of and for the nine months ended November 2, 2019.


Marvell Technology Group LTD.

Pro Forma Condensed Consolidated Balance Sheet

(in thousands)

(unaudited)

     November 2, 2019  
     Historical
Results
     Pro Forma
Adjustments
    Pro Forma
Results
 
Assets      (a)       

Current assets:

       

Cash and cash equivalents

   $ 438,369      $ 1,672,222  (e)    $ 2,110,591  

Accounts receivable, net

     495,216        —         495,216  

Inventories

     308,299        —         308,299  

Prepaid expenses and other current assets

     43,789        —         43,789  

Assets held for sale

     600,893        (600,893 )(c)      —    
  

 

 

    

 

 

   

 

 

 

Total current assets

     1,886,566        1,071,329       2,957,895  

Property and equipment, net

     316,214        —         316,214  

Goodwill

     5,161,312        41,263  (g)      5,202,575  

Acquired intangible assets, net

     2,500,215        —         2,500,215  

Other non-current assets

     438,955        —         438,955  
  

 

 

    

 

 

   

 

 

 

Total assets

   $ 10,303,262      $ 1,112,592     $ 11,415,854  
  

 

 

    

 

 

   

 

 

 
Liabilities and Shareholders’ Equity        

Current liabilities:

       

Accounts payable

   $ 212,955      $ —       $ 212,955  

Accrued liabilities

     305,827        —         305,827  

Accrued employee compensation

     130,062        —         130,062  

Liabilities held for sale

     5,610        (5,610 )(c)      —    
  

 

 

    

 

 

   

 

 

 

Total current liabilities

     654,454        (5,610     648,844  

Long-term debt

     2,036,441        —         2,036,441  

Non-current income taxes payable

     48,136        —         48,136  

Deferred tax liabilities

     214,492        —         214,492  

Other non-current liabilities

     183,921        —         183,921  
  

 

 

    

 

 

   

 

 

 

Total liabilities

     3,137,444        (5,610     3,131,834  

Total shareholders’ equity

     7,165,818        1,118,202  (f)      8,284,020  
  

 

 

    

 

 

   

 

 

 

Total liabilities and shareholders’ equity

   $ 10,303,262      $ 1,112,592     $ 11,415,854  
  

 

 

    

 

 

   

 

 

 


Marvell Technology Group LTD.

Pro Forma Condensed Consolidated Statement of Income

(in thousands, except per share amounts)

(unaudited)

 

     Nine Months Ended November 2, 2019  
     Historical
Results
    Pro Forma
Adjustments
    Pro Forma
Results
 
     (a)     (d)        

Net revenue

   $ 1,981,490     $ (214,840   $ 1,766,650  

Cost of goods sold

     929,293       (102,951     826,342  
  

 

 

   

 

 

   

 

 

 

Gross profit

     1,052,197       (111,889     940,308  
  

 

 

   

 

 

   

 

 

 

Operating expenses:

      

Research and development

     801,002       (83,358     717,644  

Selling, general and administrative

     342,988       (13,208     329,780  

Restructuring related charges

     37,070       —         37,070  
  

 

 

   

 

 

   

 

 

 

Total operating expenses

     1,181,060       (96,566     1,084,494  
  

 

 

   

 

 

   

 

 

 

Operating loss

     (128,863     (15,323     (144,186

Interest income

     3,437       —         3,437  

Interest expense

     (62,975     —         (62,975

Other loss, net

     (1,624     —         (1,624
  

 

 

   

 

 

   

 

 

 

Interest and other loss, net

     (61,162     —         (61,162
  

 

 

   

 

 

   

 

 

 

Loss before income taxes

     (190,025     (15,323     (205,348

Provision for income taxes

     (1,743     (1,209     (2,952
  

 

 

   

 

 

   

 

 

 

Net Loss

   $ (188,282   $ (14,114   $ (202,396
  

 

 

   

 

 

   

 

 

 

Net Loss per share - Basic

   $ (0.28     $ (0.30
  

 

 

     

 

 

 

Net Loss per share - Diluted

   $ (0.28     $ (0.30
  

 

 

     

 

 

 

Weighted average shares used in the calculation of net loss per share

      

Basic

     667,184         667,184  
  

 

 

     

 

 

 

Diluted

     667,184         667,184  
  

 

 

     

 

 

 


Marvell Technology Group LTD.

Pro Forma Condensed Consolidated Statement of Income

(in thousands, except per share amounts)

(unaudited)

 

     Year Ended February 2, 2019  
     Historical
Results
    Pro Forma
Adjustments
    Pro Forma
Results
 
     (b)     (d)        

Net revenue

   $ 2,865,791     $ (307,712   $ 2,558,079  

Cost of goods sold

     1,407,399       (157,026     1,250,373  
  

 

 

   

 

 

   

 

 

 

Gross profit

     1,458,392       (150,686     1,307,706  
  

 

 

   

 

 

   

 

 

 

Operating expenses:

      

Research and development

     914,009       (113,726     800,283  

Selling, general and administrative

     424,360       (16,440     407,920  

Restructuring related charges

     76,753       —         76,753  
  

 

 

   

 

 

   

 

 

 

Total operating expenses

     1,415,122       (130,166     1,284,956  
  

 

 

   

 

 

   

 

 

 

Operating income

     43,270       (20,520     22,750  

Interest income

     11,926       —         11,926  

Interest expense

     (60,362     —         (60,362

Other income, net

     519       —         519  
  

 

 

   

 

 

   

 

 

 

Interest and other income, net

     (47,917     —         (47,917
  

 

 

   

 

 

   

 

 

 

Loss before income taxes

     (4,647     (20,520     (25,167

Provision for income taxes

     174,447       (1,844     172,603  
  

 

 

   

 

 

   

 

 

 

Net Loss

   $ (179,094   $ (18,676   $ (197,770
  

 

 

   

 

 

   

 

 

 

Net Loss per share - Basic

   $ (0.30     $ (0.33
  

 

 

     

 

 

 

Net Loss per share - Diluted

   $ (0.30     $ (0.33
  

 

 

     

 

 

 

Weighted average shares used in the calculation of net loss per share

      

Basic

     591,232         591,232  
  

 

 

     

 

 

 

Diluted

     591,232         591,232  
  

 

 

     

 

 

 

Notes to the Unaudited Pro Forma Condensed Consolidated Financial Statements

(unaudited)

1. Pro Forma Adjustments

The following is a summary of the pro forma adjustments reflected in the unaudited pro forma condensed consolidated financial statements based on preliminary estimates, which may change as additional information is obtained:

 

(a)

Reflects the Company's condensed consolidated balance sheet and statement of income as of and for the nine months ended November 2, 2019, as contained in the financial statements presented in the Company's Quarterly Report on Form 10-Q, as filed with the SEC on December 4, 2019.

 

(b)

Reflects the Company's consolidated statement of income for the year ended February 2, 2019, as contained in the financial statements presented in the Company's Annual Report on Form 10-K, as filed with the SEC on March 28, 2019.

 

(c)

Represents the elimination of the assets and liabilities associated with the Wireless Connectivity Business as of November 2, 2019.

 

(d)

Represents the elimination of revenues and expenses associated with the Wireless Connectivity Business for the nine months ended November 2, 2019 and for the year ended February 2, 2019.

 

(e)

Represents the estimated cash received by the Company, net of closing costs and working capital adjustments.

 

(f)

Represents the estimated gain on sale, net of closing costs and working capital adjustments. As the gain is directly attributable to the sale and is not expected to have a continuing impact on the Company’s operations, it is only reflected in retained earnings on the unaudited pro forma condensed consolidated balance sheet.

 

(g)

Represents adjustment of goodwill allocation at close based on the relative fair value of the Wireless Connectivity Business.