Filed by Atheros Communications, Inc. Pursuant to Rule 425
Under the Securities Act of 1933
And Deemed Filed Pursuant to Rule 14a-12
Under the Securities Exchange Act of 1934
Subject Company: Intellon Corporation
Commission File No.: 001-33879
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Atheros to Acquire Intellon: Investor Relations Presentation
September 8, 2009
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Atheros
Safe Harbor Statement
Except for the historical information contained herein, the matters set forth in this presentation, including the anticipated benefits for Atheros of the acquisition of Intellon Corporation and the anticipated closing of the transaction, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially, including, but not limited to, the risk that the transaction will not close in the fourth quarter or at all, difficulties in the integration of acquired businesses, the risk that the benefits from the transaction may not be fully realized or may take longer to realize than expected, or that the transaction will not be accretive to Atheros’ non-GAAP earnings per share in the first half of 2010 or at all, disruption from the transaction making it more difficult to maintain relationships with customers, employees or suppliers, competition and its effect on pricing, third-party relationships and revenues, and the risks detailed in Atheros’ Annual Report on Form 10-K for the year ended December 31, 2008 and its Quarterly Report on Form 10-Q for the quarter ended June 30, 2009, as filed with the Securities and Exchange Commission, and in other reports filed with the SEC by Atheros from time to time. These forward-looking statements speak only as of the date hereof. Atheros disclaims any obligation to update these forward-looking statements.
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Important Additional Information and Where You Can Find It
In connection with the proposed transaction, Atheros will file a Registration Statement on Form S-4 containing a proxy statement/prospectus and other documents concerning the proposed acquisition with the Securities and Exchange Commission (the SEC). Investors and security holders are urged to read the proxy statement/prospectus when it becomes available and other relevant documents filed with the SEC regarding the proposed transaction because they will contain important information. Investors and security holders may obtain a free copy of the proxy statement/prospectus (when it is available) and other documents filed by Atheros and Intellon with the SEC at the SEC’s web site at http://www.sec.gov. The proxy statement/prospectus (when available) and other documents filed with the SEC may also be obtained for free by contacting Atheros Investor Relations by e-mail at ir@atheros.com or by telephone at (408) 830-5672 or by contacting Intellon Investor Relations by e-mail at suzanne@blueshirtgroup.com or by telephone at (415) 217-7722.
Atheros, Intellon, and their respective directors, executive officers, certain members of management and certain employees may be deemed to be participants in the solicitation of proxies in connection with the proposed transaction. Additional information concerning Atheros’ directors and executive officers is set forth in Atheros’ Proxy Statement for its 2009 Annual Meeting of Stockholders, which was filed with the SEC on April 6, 2009. Additional information concerning Intellon’s directors and executive officers is set forth in Intellon’s Proxy Statement for its 2009 Annual Meeting of Stockholders, which was filed with the SEC on April 28, 2009. These documents are available free of charge at the SEC’s web site at www.sec.gov or by going to, respectively, Atheros’ Investors page on its corporate website at www.atheros.com and Intellon’s Investor Relations page on its corporate website at www.Intellon.com. Additional information regarding the persons who may, under the rules of the SEC, be deemed participants in the solicitation of proxies in connection with the proposed transaction, and a description of their direct and indirect interests in the proposed transaction, which may differ from the interests of Atheros or Intellon stockholders generally will be set forth in the proxy statement/prospectus when it is filed with the SEC.
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Agenda
Overview of companies Transaction terms Strategy and value proposition
Strategic benefits and combined technologies Financial overview Q&A
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The Companies
Atheros
Leading developer of advanced semiconductor system solutions for wireless and wired communications Year founded: 1998 Headquarters: Santa Clara, CA Product lines: Networking & PC WLAN
Mobile WLAN Ethernet GPS Bluetooth
Employees (as of 6/30/09): 1,068
LTM (ended 6/30/09) revenue: $437MM
InTellon®
No New Wires®
Leading provider of powerline communications (PLC), providing HomePlug® compliant products for the home networking and other markets Year founded: 1989 Headquarters: Orlando, FL
Product lines: PLC/Home Plug Ethernet-over-Coax Smart Grid Employees (as of 6/30/09): 129 LTM (ended 6/30/09) revenue: $74MM
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Overview of Key Transaction Terms
Transaction Value
Consideration Mix
Other
Stock and cash transaction valued at approximately $244MM, or $181MM net of Intellon’s cash, cash equivalents and short-term investments as of June 30, 2009
Intellon shareholders to receive $7.30 per share of common stock (based on 5-day average price of Atheros common stock as of September 4, 2009) ?Intellon shareholders may elect to receive consideration as follows (subject to pro ration and other constraints detailed in the Merger Agreement): ?Approximately 0.135 shares of Atheros common stock and approximately $3.60 in cash; or ?$7.30 in cash; or ?Approximately 0.267 shares of Atheros common stock
Transaction is subject to the approval of Intellon shareholders as well as customary closing conditions and regulatory approvals Shareholders representing approximately 22% of Intellon’s outstanding common stock have signed an agreement to vote their shares in favor of this transaction ?Anticipated closing in Q4 of 2009
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Intellon Acquisition
Aligns with Key Atheros Strategies
Building a portfolio of diversified communication products to enhance its leadership in networking, computing and mobile markets
Expanding its technology portfolio to deliver the most comprehensive platforms for digital home networking
Uniting leaders in WLAN and PLC to innovate richer, simple and seamless connectivity solutions for the home
Leveraging Atheros’ core competencies in analog and networking systems design
Atheros®
InTellon®
No New Wires®
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Intellon’s Value Proposition
Leveraging the most pervasive wired connection in the home
Intellon is the leading provider and technology innovator of HomePlug® compatible ICs for home networking
20+ years innovating in powerline
34 issued patents
Operates on the most pervasive wired networking medium available today – the home power circuit
HomePlug® technology is well suited for devices that connect to electrical outlets
Intellon has shipped over 40 million chipsets to date and its solutions are utilized in 50 service provider deployments
Digital Media Adapter with Standard definition TV Home plug to Wi-Fi Bridge, Online gaming console, Voip Phone, Media Center PC, Existing home Powerline, Home Security Monitoring, Digital Audio, High Definition TV with HD Set top Box with person video recorder, Broadband, Homeplug to Router, Homeplug powerline network, Singlebox AV, Homeplug to ether adaptor,
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Strategic Benefits
Rapidly Growing ?A surge in consumer demand for rich multimedia content on an array of connected
Market devices…anywhere in the home
Unmatched combined leadership in WLAN, Ethernet and PLC enabling Atheros to drive growth in home networking market ?Wireless with wired mesh network is a game-changing technology that increases
Game Changing network… Combination ?Flexibility
Performance ?Ease of use
Leverages Atheros’ core engineering competencies and culture of innovation
Significant ?Employs the company’s market-leading integration, design excellence and volume
Product & production efficiencies to drive cost leadership and enable mass market adoption
Operating Leverages complementary and overlapping sales channels Leverage ?Currently carrier and retail networking
Opportunity for growth in new segments, such as networked digital media devices
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Atheros®
InTellon®
No New Wires®
Transforming the Digital Home Through Unprecedented Wireless with Wired Mesh Networking
“Connecting it All, Anywhere in the Home”
Broadband Access + (Cable/DSL)
WLAN Router
Broadband Modem
STB
IPTV
Gaming VoIP Home Desktop phone Security camera
HomePlug
WLAN Netbook PVR Notebook VoIP
BluRay Smart phone phone
HomePlug WiFi Player range extender
This combination enables unified, seamless connectivity platforms
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Atheros’ Growing Technology Portfolio
PC NETWORKING CONSUMER
Desktop, Notebook, Gateways, APs, Cellular, Gaming,
Market Size Netbooks and MIDs Routers and A/V PMP and Cameras Market Size
<300m Units 200-500m Units >1B Units
Expansion of Atheros Technologies
GPS GPS GPS, Bluetooth,
Leverage Key OEM and ODM Customers
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Atheros®
InTellon®
Revenue Growth Track Records
($ in millions) ($ in millions)
$472 $75
$417
$52 $302
$34 $183
$17
2005 2006 2007 2008 2005 2006 2007 2008
CAGR = 37%
CAGR = 64%
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Atheros®
InTellon®
Financial Performance
Q2 2009 Results (6/30/09)
($ in millions)
Revenue $112.2 $17.5
Q/Q Revenue Growth Rate 27.6% 12.7% Gross Profit* $53.2 $8.8 Gross Margin* 47.4% 50.4% Operating Income* $12.1 $0.9
Operating Income Margin* 10.8% 5.1% Earnings Per Share* $0.20 $0.03
Cash $340.6 $62.1 Debt $0.0 $0.0
The transaction is expected to be accretive to Atheros’ non-GAAP earnings per share in the first half 2010.
*In calculating non-GAAP financial measures, we exclude certain items to facilitate a review of the comparability of our core operating performance on a period-to-period basis. The excluded items represent stock-based compensation and charges and gains that are primarily driven by discrete events that we do not consider to be directly related to core operating performance. We use non-GAAP measures to evaluate the core operating performance of our business, for comparison with forecasts and strategic plans, for calculating return on investment and for benchmarking performance externally against competitors. In addition, management’s incentive compensation is determined using these non-GAAP measures. Also, when evaluating potential acquisitions, we primarily consider the impact of the target’s performance and valuation on our non-GAAP measures.
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Atheros®
InTellon®
Intellon Acquisition Summary
Immediately establishes Enables Atheros to further our Atheros as the leader in drive towards seamless, powerline communications ICs simple home networking
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Brings a profitable addition to the Atheros product portfolio Leverages strong technology,
50+% gross margins channel and customer synergies ?Expected to accretive in the first half of 2010
Brings a growing portfolio of seamless networking products to our strong and growing common customer base
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Atheros
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