Seeking Alpha

Infineon buying International Rectifier for $3B

  • Infineon (OTCPK:IFNNF) is paying $40/share, or $3B, in cash to acquire International Rectifier (NYSE:IRF). The price represents a 51% premium to Tuesday's close, and is well above the ~$2B reported by Bloomberg.
  • Infineon is paying ~$2.4B net of cash for the analog chipmaker. The deal will be financed with a mixture of existing cash and credit facilities, and is expected to close in late 2014 or early 2015.
  • The companies declare IRF's gallium nitride (GaN) power management discrete components and ICs complement Infineon's own GaN offerings, and (echoing arguments made for recent chip deals) that the combined company will benefit from greater R&D scale and manufacturing/operational synergies.
  • IRF is now up 47.4% to $39.16. The company has posted its FQ4 report in tandem with the Infineon announcement.
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