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United States securities and exchange commission logo
August 27, 2020
Christopher Brown
General Counsel
ALLEGRO MICROSYSTEMS INC
955 Perimeter Road
Manchester, New Hampshire 03103
Re: ALLEGRO
MICROSYSTEMS INC
Draft Registration
Statement on Form S-1
Submitted August 3,
2020
CIK 0000866291
Dear Mr. Brown:
We have reviewed your draft registration statement and have the
following comments. In
some of our comments, we may ask you to provide us with information so
we may better
understand your disclosure.
Please respond to this letter by providing the requested
information and either submitting
an amended draft registration statement or publicly filing your
registration statement on
EDGAR. If you do not believe our comments apply to your facts and
circumstances or do not
believe an amendment is appropriate, please tell us why in your
response.
After reviewing the information you provide in response to these
comments and your
amended draft registration statement or filed registration statement, we
may have additional
comments.
Draft Registration Statement on Form S-1 filed August 3, 2020
General
1. Please supplementally
provide us with copies of all written communications, as defined in
Rule 405 under the
Securities Act, that you, or anyone authorized to do so on your behalf,
present to potential
investors in reliance on Section 5(d) of the Securities Act, whether or
not they retain copies
of the communications. Please contact the staff member associated
with the review of this
filing to discuss how to submit the materials, if any, to us for our
review.
Christopher Brown
FirstName
ALLEGROLastNameChristopher Brown
MICROSYSTEMS INC
Comapany
August 27, NameALLEGRO
2020 MICROSYSTEMS INC
August
Page 2 27, 2020 Page 2
FirstName LastName
Prospectus Summary
Recent Developments, page 3
2. Please revise your disclosure to identify Sanken as an affiliate in
this section, including a
specific statement as to Sanken's percentage of ownership of your
common stock after the
completion of the initial public offering. We note your disclosure
regarding Sanken and
OEP on page 12.
Unaudited Pro Forma Consolidated Financial Data
Pro Forma Adjustments, page 68
3. We note adjustment (E) that appears to reduce your tax provision on a
pro forma basis to
exclude your $9.5 million settlement with the IRS. We also note on
page F-46 that you
received a $9.5 million contribution from Sanken to neutralize the
cash impact to the
company. Please address the following:
Describe to us the circumstances relating to the contribution from
Sanken, including
the purpose and timing, and explain how you accounted for the
contribution and how
it impacted your accounting for the settlement.
Tell us how you considered the offset you received from Sanken
when concluding to
adjust your pro forma results for the IRS settlement.
Tell us how your pro forma adjustment reflecting the IRS
settlement is directly
attributable to the PSL Divestiture and the transfer of the Sanken
products
distribution business to PSL, and has a continuing impact on
Allegro. Refer to Rule
11-02(b)(6) of Regulation S-X.
Recent Initiatives to Improve Results of Operations, page 71
4. We note that on April 3, 2020, you amended your agreement relating to
the planned
purchase of Voxtel, primarily due to the potential impact of
uncertainties from
the COVID-19 pandemic. Please expand your disclosures here and in the
Subsequent
Events note to the financial statements to clarify whether the amended
agreement also
impacted the closing date of the transaction and, if so, to update the
disclosures to indicate
the date or the period in which you now expect the acquisition to
close.
Christopher Brown
FirstName
ALLEGROLastNameChristopher Brown
MICROSYSTEMS INC
Comapany
August 27, NameALLEGRO
2020 MICROSYSTEMS INC
August
Page 3 27, 2020 Page 3
FirstName LastName
Key Operating and Financial Metrics
Adjusted EBITDA and Adjusted EBITDA Margin, page 82
5. We note your adjustment for AMTC Facility consolidation savings of
$14.5 million, and
that the transition of the facilities began in November 2019 and is
expected to be
completed by the end of March 2021. Please describe to us in greater
detail what these
savings represent. For example, tell us whether these are (i) one-time
charges taken in the
later part of fiscal year 2020 as a result of the transition, (ii)
normal operating expenses
recorded in the fiscal 2020 that the company does not expect to record
going forward, or
(iii) your estimate of projected cost savings from the transition.
Explain to us how
adjusting a non-GAAP measure for these savings is consistent with Item
10(e) of
Regulation S-K.
6. In a related matter, please describe to us in greater detail the
nature of the labor cost
savings reflected in adjustment (j).
Financial Statements
Note 18. Income Taxes, page F-41
7. We note your disclosures regarding the $9.5 million tax settlement
with the IRS on page
F-46 and the $5.5 million provision for IRS audit settlement reflected
in the table on page
F-43. Please explain to us how you accounted for the IRS audit
settlement and how the
related amounts are reflected in your rate reconciliation on page
F-43. In addition, explain
to us how you considered the $9.5 million Sanken contribution in
determining your
income tax provision.
You may contact Kevin Stertzel at 202-551-3723 or Martin James at
202-551-3671 if you
have questions regarding comments on the financial statements and related
matters. Please
contact Erin Purnell at 202-551-3454 or Geoffrey Kruczek at 202-551-3641 with
any other
questions.
Sincerely,
Division of
Corporation Finance
Office of
Manufacturing
cc: Keith L. Halverstam