Cavium is acquiring QLogic for $1B ($15.50/share)

• Cavium (CAVM) is buying server/storage connectivity hardware and chip provider QLogic (QLGC) for an equity value of $1.36B, or an enterprise value of $1B after factoring QLogic's $355M cash balance. The buyout price is equal to $15.50/share, a 14% premium to QLogic's Wednesday close.
• Cavium is paying $11/share in cash and issuing 0.098 shares for each QLogic share. The deal is expected to close in Q3.
• Cavium: "QLogic's leading portfolio of advanced connectivity and storage solutions is highly complementary to Cavium's extensive portfolio of networking, compute, and security solutions. The combination enables Cavium to offer a complete end-to-end offering to customers in Enterprise, Cloud, Data Center, Storage, Telco and Networking markets."
• The deal is expected to boost Cavium's 2017 EPS by $0.60-$0.70, and to yield $45M/year in cost synergies by the end of 2017.
• QLGC +12.3% after hours. Investors could be betting a higher offer will arrive.
• Update (6:38PM ET): Cavium is down 7.3% after hours.