The Japanese Chip Maker Renesas Electronics has its 40pc control over the global market of microcontrollers (MCUs) used in automobiles. Now the company will take control of Intersil Corp. under the lately agreed acquisition deal of about $3.2 billion, a deal which is sought to expedite its gross earnings.
Renesas will pay $22.50 a share for California-based Intersil, a premium of about 43.9% to the company’s Aug. 19 closing price.
Japanese business daily Nikkei reported the possible deal last month, Renesas said it was considering various growth options including buying Intersil.
According to Gartner research data, at the end of last year, Tokyo-based Renesas was the world’s third-largest chipmaker by market share, with 9.1 percent.
The semiconductor industry is heeling its wounds through acquisitions to foray into new potential sectors as traditional PC and smartphone segment is undergoing market success-tests.
Some of the recent acquisition which recently turned heads was Analog Devices Inc. acquisition of Linear Technology Corp. in a cash-and-stock deal initially valued at $14.8 billion.
Avago Technologies Ltd. completed hefty $37 billion acquisition of rival Broadcom Corp. in February.
Renesas expects to complete the purchase in the first half of 2017 and will finance it with cash on hand. The company projects the deal will generate synergies of $170 million.