DSP Group to buy NXP VoIP chips unit

The transaction can reach a total value of $345 million and will provide NXP with a shareholding of approximately 12% in DSP Group. DSP Group will pay $270 million, consisting of $200 million in cash and $70 million in the issuance of DSP Group's common stock on the basis of the average closing price per share for DSP Group's common stock on NASDAQ Global Market during the twenty business days ending on the fifth business day prior to the closing of the transaction, for NXP's Cordless & VoIP terminals business, currently part of the company's Mobile and Personal Business Unit. DSP Group has also agreed to a contingent cash payment of up to $75 million payable based on future revenue performance. The transaction is expected to be positive to earnings per share of DSPG in 2007 and beyond, excluding transaction expenses, intangible amortization and other one time charges in connection with the acquisition. The transaction is expected to close in the third quarter of 2007, subject to closing conditions, including regulatory approvals. NXP's Cordless & VoIP terminals business generated approximately $220 million revenue in 2006 and comprises some 200 staff based at locations around the world, most of whom will transfer to the DSP Group.