This has to come in serendipity or it just a billion dollar amusement, Analog Devices (ADI) is all set to acquire its long vie Linear Technology Corp. in all cash deal and rest of the buyout for $14.8 billion, official report.
This deal is a naive reinforcement for milking profit and growth in the fragmented market of analog chips, which process signals such as sound, light and temperature and convert them into digital signals.
The deal will bring together two analog semiconductor powerhouses and would be the latest in a string of blockbuster semiconductor deals over the past few years.
Under the terms of the deal, ADI will pay $46 and 0.23 shares of ADI for each share of Linear Technology common stock, the companies said. The transaction values Linear at $60 per share, a premium of about 24% over its closing price of $48.47 Monday.
ADI ranked fourth in analog chip sales in 2015, which Linear gripped to the No. 8 position, according to market research firm IC Insights. Combined, the two firms held about 9% of the analog IC market in the first quarter, according to IC Insights.
“We believe this is the right deal at the right time in the analog industry,” Vincent Roche, ADI’s president and CEO, said in a conference call Tuesday.
This is not the first time that the semiconductor industry is catching the fire of acquisitions as in the past two years, the whole industry’s acquisition deals accounted more than $100 billion. Among the silver screen takers were, Avago Technologies Ltd.’s $37 billion acquisition of Broadcom Corp., Intel Corp.’s $16.7 billion acquisition of Altera Corp. and NXP Semiconductors NV’s $11.8 billion acquisition of Freescale Semiconductor Inc.
If you combine the companies offerings then the word ‘Hyperconverged’ can be well interpreted in the semiconductor businesses on the long run.
The deal is expected to close in the first half of 2017.