3Dlabs Lands Intense3D Software Deal
3Dlabs, Inc. Ltd., a high-end 3D graphics tool creator, announced that it has acquired the assets of the Intense3D operations of Intergraph Corporation. The stock transaction is expected to add to earnings on a goodwill (EBG) basis from the third quarter of 2000 onwards. Under the terms of the agreement, 3Dlabs will issue up to US$3.69 million common shares of 3Dlabs to Intergraph as initial consideration for the acquired assets and goodwill, with an earn-out provision totaling up to an additional $25 million, payable in stock and/or cash. The earn-out will be based on certain performance metrics for the Intense3D operations for the remainder of 2000 following the closing of the transaction. In addition, 3Dlabs will continue to supply professional graphics and digital media accelerators for incorporation into Intergraph's system products. Still subject to regulatory approvals, the deal is expected to close during the second quarter of 2000. 3Dlabs will incur one-time acquisition related charges in the second quarter of 2000. Huntsville, Alabama-based Intense3D is best known for its highly-acclaimed Wildcat range of professional products. "This acquisition combines the business success, resources and expertise of two complementary market leaders and continues 3Dlabs' role as a consolidator in the workstation graphics industry which started with our acquisition of Dynamic Pictures back in 1998," said Osman Kent, president and CEO of 3Dlabs. "3Dlabs will now have multiple proven development teams, each with its own critical mass. This should enable the combined company to increase our frequency of product introductions into the professional graphics market and to liberate engineering resources for developing products for additional growth markets, both on the traditional PC and the emerging appliance platforms." James F. Taylor, CEO of Intergraph, said, "3Dlabs has a focused commitment to the workstation graphics market, and is the best company to immediately leverage Intense3D's technology, skills, and commercial momentum. This integration of two market leaders, with complementary goals, technology, and customers, will create a formidable force in the graphics industry. We are confident that in the capable hands of 3Dlabs, the interests of Intense3D's customers and employees will be well served."