Freescale Buying SigmaTel

Freescale Semiconductor, a maker of embedded chips, has agreed to acquire SigmaTel Inc. (Nasdaq: SGTL), a maker of mixed-signal ICs for the consumer electronics market. The deal is valued at approximately $110 million in cash, with SigmaTel stockholders to receive $3 per share (67% premium over Friday's closing price). Freescale was taken private in late 2006 for $17.6 billion, by The Blackstone Group, The Carlyle Group, Permira and Texas Pacific Group.




Freescale Semiconductor, a privately held, global leader in the design and manufacture of embedded semiconductors and SigmaTel, Inc. (NASDAQ: SGTL), today announced that they have entered into a definitive agreement for Freescale to acquire SigmaTel. SigmaTel is a leading provider of analog intensive, mixed-signal integrated circuits (ICs) for the digital multimedia market.

Under the terms of the agreement, Freescale will pay $3 per outstanding share of SigmaTel stock representing approximately $110 million in cash. The agreement is subject to various customary closing conditions, including all necessary shareholder and regulatory approvals, and is expected to close in the second quarter of fiscal year 2008.

“The SigmaTel acquisition enhances the long-term, strategic value we can deliver to our customers,” said Lynelle McKay, senior vice president and general manager of Freescale's Networking and Multimedia Group. “Freescale's proven strengths in the high- performance multimedia and general purpose markets are complemented by SigmaTel's strong analog and mixed-signal expertise in the portable media player and consumer audio markets.”

“The increased demand for feature rich, always-connected consumer electronics devices is driving manufacturers to look for platform-based solutions that will accelerate time to market,” said Phil Pompa, president and CEO of SigmaTel. “With the addition of SigmaTel, Freescale is the obvious choice for these next-generation devices.”

About Freescale Semiconductor
Freescale Semiconductor is a global leader in the design and manufacture of embedded semiconductors for the automotive, consumer, industrial, networking and wireless markets. The privately held company is based in Austin, Texas, and has design, research and development, manufacturing or sales operations in more than 30 countries. Freescale is one of the world's largest semiconductor companies with 2007 sales of $5.7 billion (USD)

About SigmaTel
SigmaTel is a fabless semiconductor company which designs, develops, and markets mixed-signal ICs for the consumer electronics market. The Company's target market segments include portable media players, printers and digital televisions. SigmaTel provides complete, system-level solutions that include highly-integrated ICs, customizable firmware and software, software development tools and reference designs. The Company's focus is on enabling customers to rapidly introduce and offer electronic products that are small, light-weight, power-efficient, reliable, and cost-effective. SigmaTel is ISO 9001:2000 certified and is committed to providing customers with high performance, quality products along with superior, worldwide customer service.

Additional Information about the Proposed Transaction and Where to Find It

SigmaTel will file a proxy statement and other documents regarding the proposed transaction described in this press release with the Securities and Exchange Commission. INVESTORS AND SECURITY HOLDERS ARE URGED TO READ THE PROXY STATEMENT AND SUCH OTHER MATERIALS WHEN THEY BECOME AVAILABLE, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT SIGMATEL AND THE PROPOSED TRANSACTION. A definitive proxy statement will be sent to security holders of SigmaTel seeking their approval of the transaction. Investors and security holders may obtain a free copy of the definitive proxy statement (when available) and other documents filed by SigmaTel with the Securities and Exchange Commission at the SEC's web site at The definitive proxy statement and other relevant documents (when available) may also be obtained free of cost by directing a request to Martha Aviles at 512-744-9968.

SigmaTel's directors and executive officers may be deemed, under Securities and Exchange Commission rules, to be participants in the solicitation of proxies from the SigmaTel's stockholders in connection with the proposed transaction. Information about SigmaTel's directors and officers can be found in SigmaTel's Proxy Statements and Annual Reports on Form 10-K filed with the SEC. Additional information regarding the interests of those persons may be obtained by reading the proxy statement and other documents regarding the proposed transaction when they become available.