Aquantia

Profile (continued)

Aquantia priced its IPO at $9.00 per share on November 2, 2017, offering 6,818,000 shares (total offering size $61.36 million; net proceeds to the company approximately $57.1 million before the underwriters' over-allotment option), and began trading on the NYSE under ticker 'AQ' on/around November 3, 2017; shares were delivered November 7, 2017. Lead underwriters were Morgan Stanley, Barclays and Deutsche Bank Securities, with Needham & Company and Raymond James as additional underwriters. At IPO, greater-than-5% stockholders were Aquan LLC (CEO-affiliated holding entity), Joint Stock Company RUSNANO (Russian state fund), entities affiliated with Pinnacle Ventures, entities affiliated with Walden International, GLOBALFOUNDRIES U.S. Inc., and Paxion Partners, LP -- Greylock was not among them, having exited via the pre-IPO secondary sale described above.

As a public company Aquantia reported revenue of $24.5 million (2014), $80.8 million (2015), and $86.7 million (2016), with Intel representing an outsized share of revenue (roughly 65-78% in various years) because Aquantia's PHY chips shipped alongside Intel network controllers -- a customer-concentration risk repeatedly flagged in its filings. Its named board of directors and officers around the IPO/pre-acquisition period included Faraj Aalaei (Chairman/President/CEO), Mark Voll (CFO, since Jan. 2016; predecessor CFO Linda Reddick moved to SVP Finance), Kamal Dalmia (SVP Sales & Marketing), Ramin Shirani (SVP Engineering & director), and non-employee directors Dmitry Akhanov (Rusnano USA CEO, director since April 2013), Bami Bastani (GLOBALFOUNDRIES SVP RF, ex-CEO of Meru Networks and Trident Microsystems, director since June 2016), Geoffrey G. Ribar (former Cadence Design Systems CFO, director since Sept. 2017), Ken Pelowski (founder/Managing Partner of Pinnacle Ventures, director since April 2013), Sam Srinivasan (Inphi board member, former Cirrus Logic CFO, director since Dec. 2015), Anders Swahn (former Alion Energy/Nicira/PicoChip/Abrizio executive, director since Aug. 2008), and Lip-Bu Tan (Walden International founder/Chairman and Cadence Design Systems President/CEO, lead independent director since Oct. 2016, director since March 2015).

On May 6, 2019, Aquantia entered into an Agreement and Plan of Merger with Marvell Technology Group Ltd. (via merger subsidiary Antigua Acquisition Corp.), agreeing to be acquired for $13.25 per share in cash -- an all-cash equity value of roughly $476 million based on the ~35.97 million shares outstanding as of the June 2019 proxy record date (commonly reported in press coverage as an enterprise value of approximately $452 million, likely net of Aquantia's cash on hand; the exact net-of-cash figure could not be independently re-verified from primary sources in this research session, but the $13.25/share price and the ~36M share count are both confirmed directly from SEC filings). Aquantia's proxy (DEFM14A, filed June 10, 2019) disclosed 'Supporting Stockholders' who agreed to vote in favor of the merger, representing about 13.4% of shares: WRV II, L.P. and Walden Riverwood Venture, L.P. (Walden International-affiliated funds), Joint Stock Company 'RUSNANO', CEO Faraj Aalaei, and lead independent director Lip-Bu Tan, plus certain of their trusts -- notably, Greylock is not among the supporting/major stockholders at this stage either, consistent with its 2017 exit. The deal closed on September 19, 2019 (Aquantia's stock was delisted from the NYSE and the company became a wholly owned subsidiary of Marvell). Marvell's stated strategic rationale was to combine Aquantia's Ethernet PHYs with Marvell's switch and processor portfolio into what CEO Matt Murphy called 'an unparalleled networking platform,' spanning enterprise, data-center and automotive (autonomous-vehicle) customers. Aquantia's former CEO, Faraj Aalaei, joined Marvell in a senior leadership role after the close. The Aquantia brand was subsequently phased out and folded into Marvell's networking/connectivity product lines.

In Aquantia's own IPO prospectus, it named its principal competitors in the enterprise and data-center markets as Broadcom and Marvell -- meaning Marvell went from being a disclosed competitor to Aquantia's eventual acquirer within about 18 months of the IPO.

Go-to-market

Networking OEMs and hyperscale/enterprise infrastructure vendors building servers, switches, wireless access points, and (later) automotive ADAS/infotainment systems requiring multi-gigabit Ethernet connectivity; named end customers included Aruba (HPE), Brocade, Cisco, Dell, Hewlett-Packard Enterprise, Huawei, Intel, Juniper, Oracle and Ruckus.

Ownership

subsidiary — parent: Marvell Technology Group