MaxLinear to Acquire Silicon Motion in USD 8bn Deal.
MANews-(C)2009-2022
US-based radio frequency, analog and mixed-signal integrated circuits MaxLinear, Inc. (NASDAQ: MXL) has entered into a definitive agreement under which MaxLinear will acquire Taiwan-based Silicon Motion (NASDAQ: SIMO) in a cash and stock transaction that values the combined company at USD 8bn in enterprise value, the companies said.
In the merger, each American Depositary Share of Silicon Motion, which represents four ordinary shares of Silicon Motion, will receive USD 93.54 in cash and 0.388 shares of MaxLinear common stock, for total per ADS consideration of USD 114.34 (based on MaxLinear's May 4, 2022 closing price).
The strategic business combination is anticipated to drive transformational scale, create a diversified technology portfolio, significantly expand the combined company's total addressable market, and create a highly profitable cash generating semiconductor leader.
Upon completion of the acquisition, the combined company will have a highly diversified technology platform with strong positions across the broadband, connectivity, infrastructure, and storage end markets.
The combination of MaxLinear's RF, analog/mixed-signal, and processing capabilities with Silicon Motion's market leading NAND flash controller technology completes a total technology stack which fully captures end-to-end platform functionality and accelerates the company's expansion into enterprise, consumer, and many other adjacent growth markets.
Combined revenues are expected to be more than USD 2bn annually and are supported by the technology breadth to address a total market opportunity of roughly USD 15bn.
The combined scale is expected to provide additional technology, resources, and capabilities to accelerate product innovation, improve operational efficiency and drive lower manufacturing costs.
Together, MaxLinear and Silicon Motion will have expanded resources to better support the combined company's broad customer relationships with their long-term storage requirements.
The transaction is expected to generate annual run-rate synergies of at least USD 100m to be realized within 18 months after the transaction closes and is expected to be immediately and materially accretive to MaxLinear's non-GAAP earnings per share and cash flow.
Under the terms of the definitive agreement, the transaction consideration will...
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