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Wednesday, July 27, 2016

Analog Devices buys Linear and shakes up IoT

By Nick Flaherty www.flaherty.co.uk

The consolidation in the power industry continues at speed with Analog Devices buying Linear Technology for 14.8 bn.

The combined company will have a revenue approaching $5 bn in analogue and power devices making it the second largest after Texas Instruments. TI has revenue of $8.3 bn, so there's still a long way to go, but it puts Analog well ahead of both Infineon and Skyworks, according to data from IC Insights.

One of the interesting things is the role of Dust Networks, which Linear bought in 2011 for its proprietary ultra-low power mesh networking technology that fits well with the Internet of Things, especially with energy harvesting where Linear also supplies key power management chips. Analog doesn't have much of a role in low power RF transceivers, but the Dust technology is a good fit for the sensors and data acquisition chips where Analog dominates, creating a complete reference design for battery-basked and energy harvesting IoT wireless sensor nodes.
Linear Technology shareholders will receive $46.00 per share in cash and 0.2321 of a share of Analog Devices common stock, valuing Linear at $14.8 bn.

“The combination of Analog Devices and Linear Technology brings together two of the strongest business and technology franchises in the semiconductor industry,” said Vincent Roche, President and Chief Executive Officer of Analog Devices. “Our shared focus on engineering excellence and our highly complementary portfolios of industry-leading products will enable us to solve our customers’ biggest and most complex challenges at the intersection of the physical and digital worlds. We are creating an unparalleled innovation and support partner for our industrial, automotive, and communications infrastructure customers."

“For 35 years, Linear Technology has had great success by growing its business organically," said Bob Swanson, Executive Chairman and Co-founder of Linear Technology. "However, this combination of Linear Technology and Analog Devices has the potential to create a combination where one plus one truly exceeds two. As a result, the Linear Technology Board concluded that this is a compelling transaction that delivers substantial value to our shareholders, and the opportunity for additional upside through stock in the combined company. By combining our complementary areas of technology strength, we have an excellent opportunity to reinforce our leadership across the analog and power semiconductor markets [to] advance the technology and deliver innovative analogue solutions to our customers worldwide.”

www.analog.com


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