• Pro forma valuation of GCT of $661 million, which includes up to 20.0 million performance-based earnout shares
• Transaction values GCT at a pro forma enterprise value of approximately $461 million at closing
• Transaction is expected to provide GCT with up to $87 million of gross proceeds to fund continued development of a full-band 5G chipset portfolio and expansion into new markets
• Approximately $43 million to be funded via fully committed PIPE and convertible note financing from both existing and new investors of GCT
• All GCT existing stockholders will retain their equity holdings through GCT’s transition into the publicly listed company at closing

SAN JOSE, Calif. & NEW YORK — (BUSINESS WIRE) — November 3, 2023 — GCT Semiconductor, Inc. (“GCT Semiconductor” or “GCT”), a leading fabless designer and supplier of advanced LTE, IoT and 5G semiconductor solutions, and Concord Acquisition Corp III (NYSE: CNDB) (“Concord”), a special purpose acquisition company, announced today that they have entered into a definitive business combination agreement that would result in GCT becoming a publicly traded company. Upon closing of the proposed transaction, the combined company will operate as GCT Semiconductor and is expected to be listed on the NYSE under the ticker symbol “GCTS”. The proposed transaction values GCT at an initial enterprise value of approximately $461 million, with a total pro forma enterprise value of $661 million, which includes 20.0 million performance-based earnout shares. The transaction is expected to provide the combined company with approximately $87 million of gross proceeds (assuming no redemptions from Concord’s trust account) at closing to fuel its continued growth.

“We are thrilled to partner with Concord who has a deep understanding of our technology, customer base, and the timing and potential of the 4G and 5G markets,” said John Schlaefer, President and Chief Executive Officer of GCT. “We believe that this transaction will strengthen GCT’s business operations and provide the funding needed to fuel our 5G product development and commercialization as the global markets transition from 4G to 5G. We are very excited for the future and look forward to continuing as a key supplier for the 5G ecosystem as customer volume and use cases increase and expand.”

“This transaction represents an important milestone for GCT as it continues its mission to innovate and develop market leading wireless solutions in the semiconductor industry,” said Dr. Kyeongho Lee, Chairman of the Board and Co-Founder of GCT. “We believe this transaction will not only enable GCT to achieve the next level of growth as a publicly traded company, but also bring significant value to our stockholders and customers whose loyalty and support have been critical to our success over the years.”

“GCT has developed an incredible amount of intellectual property and expertise over many years, as evidenced by their impressive roster of long-standing customers and partners,” said Jeff Tuder, Chief Executive Officer of Concord. “We envision a significant opportunity for GCT going forward as 5G wireless networks proliferate worldwide and GCT continues to increase its share of the market in the midst of a destabilized competitive environment. We look forward to working with GCT to capitalize on this exciting market opportunity.”

GCT Semiconductor Overview

GCT Semiconductor is a leading supplier of highly integrated 4G LTE and 5G semiconductor solutions. GCT offers SoC solutions integrating RF, baseband modem, digital signal processing and protocol stack as a total solution, providing optimal form factors, low power consumption, high performance, high reliability and cost effectiveness. GCT works collaboratively with a variety of global Tier 1 wireless operators, ODMs and OEMs to design differentiated solutions for rapidly growing non-handset wireless broadband applications. GCT has over 120 patents globally, engagements with multiple 5G partners, and proprietary Multi-antenna Modem and transceiver technology. The Company has successfully commercialized single-chip 4G (CAT3/4) LTE solution, 4x4 MIMO 4.5G (CAT7) LTE solution, and the 8RX 4.75G (CAT12) LTE solution. GCT is developing one of the most competitive and cost-effective full-band and full-features 5G chipset portfolio for global markets.

GCT Investment Highlights

• Scarcity value and significant barriers to entry: GCT is one of only a handful of remaining companies worldwide with commercially-proven 4G LTE & 5G solutions, leveraging leading-edge multi-antenna modem tech to provide differentiated solutions to operators
• Strong patent portfolio: GCT’s portfolio of over 120 patents and proprietary multi-antenna transceiver and modem technology promote long-term design relationships.
• Proven ability to support major wireless programs: GCT has a proven history of supplying SoC and chipsets into major wireless platforms spanning CAT-1/M1/NB IoT and 4G CAT3 to 4.75G CAT12 mobile router and CPE.
• 4G to 5G transition a boon to ASPs and margins: 4x improvement in ASPs between 4G and 5G chipsets expected to drive significant inflection in revenue and gross margins in 2024 and beyond.
• Multiple 5G development agreements demonstrate GCT’s importance to the industry: Multiple development agreements with operators, OEM and ODM partners position GCT as a valuable 5G silicon & software provider.
• Strategic foundry relationship with Samsung for 8nm and below: GCT and Samsung Foundry enjoy a mutually beneficial foundry relationship providing secure access to leading-edge technology and manufacturing capacity as GCT’s 5G business ramps.
• Strong growth driven by steady 4G business while 5G ramp is anticipated: 4G base business expected to be supplemented by rapid 5G revenue ramp driven by volume demand from existing development partners.

Summary of the Transaction

Concord has agreed to combine with GCT based on a $661 million pro forma enterprise valuation, which includes 20.0 million performance-based earnout shares to GCT stockholders.

The transaction is expected to deliver up to $87 million of gross proceeds to the company, consisting of $43 million fully committed common stock PIPE and convertible note financing and up to approximately $43 million from Concord’s trust account that may become available to the company at closing (assuming no redemptions from Concord’s trust account).

The transaction has been unanimously approved by the boards of directors of each of Concord and GCT and is subject to approval by each party’s respective stockholders and other customary closing conditions. The transaction is expected to close in the first quarter of 2024.

At closing, GCT’s board of directors is expected to be comprised of seven members, two of whom will be nominated by Concord’s sponsor with the remainder nominated by GCT.

Upon completion of the transaction, the combined company is expected to trade on the NYSE under the ticker symbol “GCTS”.

Additional information about the proposed transaction, including a copy of the Business Combination Agreement and an investor presentation, will be provided in one or more current reports on Form 8-K to be filed by Concord Acquisition Corp III with the United States Securities and Exchange Commission (the “SEC”) and available at www.sec.gov.

Advisors

TD Cowen is acting as exclusive financial advisor and lead capital markets advisor to Concord, and Cohen & Company Capital Markets, a division of JVB Financial, LLC, is acting as a capital markets advisor to Concord. B. Riley Securities, Inc. is acting as the exclusive financial advisor to GCT. Greenberg Traurig, LLP is acting as legal advisor to Concord. Morgan, Lewis & Bockius LLP is serving as legal advisor to GCT. DLA Piper LLP (US) is acting as legal advisor to TD Cowen and B. Riley Securities, Inc.

About GCT Semiconductor

GCT Semiconductor is a leading fabless designer and supplier of advanced 5G and 4G LTE semiconductor solutions. GCT’s market-proven solutions have enabled fast and reliable 4G LTE connectivity to numerous commercial devices such as CPEs, mobile hotspots, routers, M2M applications and smartphones, etc., for the world’s top wireless carriers. GCT’s system-on-chip solutions integrate radio frequency, baseband modem and digital signal processing functions, therefore offering complete 4G and 5G platform solutions with small form factors, low power consumption, high performance, high reliability, and cost effectiveness. For more information, visit www.gctsemi.com.

About Concord Acquisition Corp III

Concord Acquisition Corp III is a special purpose acquisition company formed for the purpose of entering into a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses in the financial services or financial technology industries. It is sponsored by Concord Sponsor Group III LLC, an entity affiliated with Atlas Merchant Capital LLC, an investment firm that offers debt and equity investment strategies, seeking long-term value through differentiated expertise in financial services and credit markets.