By Nick Flaherty www.flaherty.co.uk
Microcontroller designer Microchip Technology is to buy Microsemi in a surprise $10bn deal that will take the combined company over $50bn in revenues.
The two have signed a definitive
agreement acquire Microsemi for $68.78 per
share in cash. The acquisition price represents a total equity value of about
$8.35 billion, and a total enterprise value of about $10.15 billion, after
accounting for Microsemi’s cash and investments.
The deal particularly brings Microchip two new product categories - discrete devices and FPGAs.
"Joining forces and combining our complementary
product portfolios and end market exposure will offer our customers a richer
set of solution options to enable innovative and competitive products for the
markets they serve,” said Ganesh Moorthy, President and COO of Microchip. The company's last chip deal was Atmel in 2016.
Microchip anticipates achieving an estimated
$300m in savings in the third year.
Subject to approval by Microsemi
stockholders and regulatory approvals, the deal is expected to close in the next three months.