Latest News
MACOM to buy US chip supplier Mindspeed for USD272m
Wednesday 06 November 2013

6 November 2013 – US-based semiconductor supplier MACOM Technology Solutions has agreed to buy domestic peer Mindspeed Technologies Inc (NASDAQ:MSPD) in a deal valued at USD272m (EUR201.4m), the two companies said.

MACOM aims to wholly acquire Mindspeed in a tender offer of USD5.05 per share, which represents a premium of about 66% to the stock's market close on 4 November, the day before the agreement was announced on Tuesday. It will finance the purchase with cash-on-hand and an existing revolving credit facility.

The deal has the approval of the boards of the two companies, but is subject to customary closing conditions and regulatory approvals.

Mindspeed develops and sells semiconductors for communications applications in the wireline and wireless network infrastructure such as enterprise networks, broadband access networks (fixed and mobile), and metropolitan and wide area networks (WAN).

The target complements MACOM's existing operations particularly within the high-performance analog market industry, Mindspeed's CEO, Raouf Halim said in a press release. The expected synergies are seen to enhance the buyer's non-GAAP earnings per share by between USD0.15 and USD0.20 in fiscal 2014 and between USD0.25 and USD0.30 per in fiscal 2015.

Mindspeed is in advanced talks with another buyer to sell its wireless business and expects to do it before the closing of the transaction with MACOM. However, the outcome of the sale process will not affect the deal with MACOM or its price, Mindspeed added.

The combined trailing twelve months (TTM) sales of the two companies amount to nearly USD451m with non-GAAP gross margin of about 50%, excluding Mindspeed's wireless business.

Mindspeed was advised by Morgan Stanley on the financial aspects of the acquisition, Wilson Sonsini Goodrich & Rosati PC on the legal side, while the board was consulted by Needham & Company.

MACOM got financial advice from Barclays and legal counselling from Perkins Coie LLP.
Details
Date Published: 06/11/2013
Target: Mindspeed Technologies
Country: USA
Deal Size: 272m (USD)
Sector: Electronics
Type: Corporate acquisition
Financing: Existing resources, Cash
Status: Agreed, Bidding
Buyer: M/A-COM Technology Solutions
Buyer Advisor: Perkins Coie LLP, Barclays
Comment:
The deal does not include Mindspeed´s wireless business.

Options