Wed, Mar. 23, 4:32 PM
- Analog/mixed-signal and telecom chipmaker Microsemi (NASDAQ:MSCC) is selling its embedded security, RF/microwave, and custom microelectronics businesses to embedded processing module/subsystem maker Mercury Systems (NASDAQ:MRCY) for $300M in cash.
- The deal is expected to close in calendar Q2. Microsemi declares the sale frees up capital "for the ongoing development of proprietary, higher-value solutions for our aerospace & defense, communications, industrial and storage end markets," and pay down debt raised to finance the PMC-Sierra acquisition. The company also uses the occasion to affirm its FQ2 (calendar Q1) guidance.
- Mercury notes the acquired businesses had revenue of $100M and adjusted EBITDA of $28M in Microsemi's FY15 (ended last September), and predicts the deal will be "highly accretive" to its FY17 (ends June '17) EPS and adjusted EBITDA margin. It's paying for the purchase via $50M in existing cash + a $265M term loan, and also taking out a $75M credit facility that won't be tapped for now.
- Mercury: "The transaction adds secure solid-state storage to our array of industry-leading, pre-integrated processing subsystems capabilities. It nearly doubles the size of our RF and Microwave business, adding new capabilities, scale and synergies. In addition, it provides us with new capabilities in embedded security and mixed signal system-on-chip processing. All these capabilities are highly aligned with our business from a strategic perspective..."
- Microsemi is unchanged after hours. Mercury is up 3% to $16.99.
- PRs: Microsemi, Mercury Systems
Apr. 3, 2014, 5:26 PM
- Mercury Systems (MRCY) +8.6% AH on a Reuters report that says Boeing (BA) is considering buying the supplier of digital signal and image processing systems to the aerospace and defense industry.
- A Boeing acquisition of one of its suppliers would allow it to save costs and increase its footprint in commercial aerospace components, and would allow it to gain access to MRCY's microprocessor business, which can be used on unmanned aerial vehicles.
- MRCY is said to be seeking ~$500M in a sale.
Mar. 18, 2014, 4:53 PM
- The WSJ reports Mercury Systems (MRCY +19.2%) is in the early stages of a sale process, with initial bids about to arrive. Sources think the maker of aerospace/defense embedded computing systems could fetch $500M.
- Shares soared to new 52-week highs in afternoon trading on the report. Mercury currently has a market cap of $438M.
Jun. 11, 2012, 8:22 AM
Dec. 23, 2011, 6:43 AM
Mercury Computer (MRCY) picks up KOR Electronics and subsidiary Paragon Dynamics for $70M in a deal expected to close before the end of the year. The firm says the acquisition will be funded with cash, and is expected to be immediately accretive to earnings.| Dec. 23, 2011, 6:43 AM