Thu, Jun. 30, 3:14 PM
- Skyworks (SWKS +2.2%) adds to session gains in the past few minutes amid unconfirmed takeover rumors.
Nov. 24, 2015, 7:24 AM
- Microsemi (NASDAQ:MSCC) has agreed to buy PMC-Sierra (NASDAQ:PMCS) for about $2.5B just hours after Skyworks Solutions (NASDAQ:SWKS) said it won't modify its bid.
- The deal will see Microsemi pay $9.22 in cash and 0.0771 of a company share for each PMC common share, representing a 77.4% premium to PMC's closing stock price as of Sept. 30.
- Microsemi anticipates the transaction to achieve more than $100M in annual cost synergies and estimates approximately $0.60 of non-GAAP EPS accretion in the first full year after closing.
- PMCS +0.7% premarket
- Previously: Skyworks abandons deal for PMC (Nov. 24 2015)
Nov. 24, 2015, 6:21 AM
- Skyworks Solutions (NASDAQ:SWKS) has withdrawn its agreed takeover bid for PMC-Sierra (NASDAQ:PMCS) after an increased offer of $2.3B from Microsemi (NASDAQ:MSCC) gained the backing of the target's board.
- Skyworks said it won't modify its bid and that the company is entitled to a $88.5M termination fee from PMC.
- Semiconductor makers have pursued mergers at a record pace this year as surging costs for design and manufacturing, coupled with a shrinking customer base, have created a need to bulk up.
- Previously: PMC-Sierra board gives thumbs up to latest Microsemi bid (Nov. 19 2015)
Nov. 19, 2015, 7:24 AM
- Microsemi (NASDAQ:MSCC) says the PMC-Sierra board has informed the company that its revised proposal constitutes a "Superior Proposal" to that of Skyworks Solutions (NASDAQ:SWKS).
- That new proposal from yesterday upped the cash portion of the bid to $9.22 per share from $9.04, while keeping the stock portion at 0.0771 shares of MSCC.
- Skyworks has three days to revise its bid, or the merger agreement with it will be terminated.
- Previously: Microsemi boosts cash portion of bid for PMC-Sierra (Nov. 18)
Nov. 18, 2015, 7:33 AM
- The new proposal would pay $9.22 in cash and 0.0771 shares of MSCC stock for each share of PMCS. Based on yesterday's close, this values each share of PMCS at $12.05.
- The previous bid was for $9.04 in cash and the same amount of MSCC shares.
- The new deal would still be immediately accretive to Microsemi's non-GAAP EPS (by $0.60 in year one) and free cash flow.
- Previously: PMC-Sierra: Skyworks offer still superior to Microsemi bid (Nov. 2)
- PMCS +2.4% to $11.93 premarket; MSCC flat, Skyworks SWKS +1.1%
Nov. 2, 2015, 3:56 AM
- Putting some clarity to a two week bidding war, PMC-Sierra Inc (NASDAQ:PMCS) said Microsemi's (NASDAQ:MSCC) latest stock and cash proposal is not superior to Skyworks Solutions' (NASDAQ:SWKS) all-cash offer, which provides "more value certainty" to shareholders.
- The board of directors continues to recommend the amended and restated merger agreement with Skyworks to its shareholders.
- On Friday, Microsemi hiked its offer to buy PMC-Sierra to about $2.33B, topping a $2.27B proposal from Skyworks Solutions five hours after the latter raised its bid.
- Previously: Microsemi counters Skyworks' new deal for PMC with an $11.88/share offer (Oct. 30 2015)
- Previously: Skyworks, PMC-Sierra strike revised deal topping Microsemi's offer (Oct. 30 2015)
- Previously: Microsemi -6.3% following PMC-Sierra bid; Skyworks -2% (Oct. 19 2015)
- Previously: Microsemi offers to buy PMC-Sierra for $11.50/share, trumping Skyworks' bid (Oct. 19 2015)
Oct. 30, 2015, 12:45 PM
- Just a few hours after Skyworks (SWKS +3%) and PMC-Sierra (PMCS +3.1%) announced they'd agreed to a revised $11.60/share, all-cash, deal (topping Microsemi's $11.50/share bid), Microsemi (MSCC -2.3%) has unveiled an $11.88/share cash/stock offer.
- The offer consists of $9.04/share in cash + 0.0771 Microsemi shares for each PMC share. Microsemi expects a deal to add $0.60 in EPS in its first full year after closing, and to eventually produce over $100M/year in cost synergies. No word on whether Microsemi would foot the bill for the $88.5M termination fee PMC owes Skyworks if it abandons its current deal.
- Microsemi remains lower on the day, while Skyworks and PMC remain higher. PMC is trading near $12.00.
Oct. 30, 2015, 9:10 AM
- 11 days after Microsemi (NASDAQ:MSCC) unveiled an $11.50/share cash/stock offer for PMC-Sierra (NASDAQ:PMCS) that topped Skyworks' (NASDAQ:SWKS) $10.50/share deal with the company, Skyworks and PMC announce they've agreed to a revised $11.60/share, all-cash, deal.
- The termination fee has been hiked to $88.5M from $70M. As previously announced, Skyworks plans to finance the deal with a mixture of existing cash and debt.
- PMCS +2.9% premarket to $11.98, as markets bet the bidding war isn't over. SWKS +0.8% premarket to $75.25.
Oct. 19, 2015, 2:55 PM
- The Street isn't reacting favorably to analog/mixed-signal chipmaker Microsemi's (NASDAQ:MSCC) cash/stock offer to buy storage and telecom IC vendor PMC-Sierra (PMCS +13.7%). Following today's selloff, Microsemi's bid for PMC is worth $11.35/share. With PMC trading at $11.65, investors are betting Skyworks (NASDAQ:SWKS) will up its prior $10.50/share bid.
- S&P thinks Skyworks could raise its offer. However, Brean and Oppenheimer argue the company might walk away. Brean notes Skyworks sold off after the PMC deal was announced amid concerns about a lack of product synergies, and both firms observe Skyworks has taken a disciplined approach to M&A.
- For Microsemi, a PMC deal would further an M&A-driven product line expansion that has led the company to buy medical/telecom IC vendor Zarlink Semi ($525M), timing IC vendor Symmetricom ($230M), and most recently Ethernet chipmaker Vitesse ($389M). The company sees PMC adding over $0.60 to EPS in the first year after closing, thanks partly to over $100M in cost synergies. It would rely on both existing cash and $2.7B in debt to help finance the purchase.
- Raymond James' Mitch Steves has hiked his Microsemi target by $3 to $41 in response to the bid. "Overall, given the $0.60 in year one accretion and material cost savings ... we view the transaction as a positive. In addition, we came away with the following key takeaways from the Conference call: 1) leverage will remain reasonable at ~4x [trailing 12 month] EBITDA, 2) overall business is chugging along with Dec-qtr in-line with Street expectations due to [aerospace/defense]/Military/Industrial strength and 3) Vitesse cost synergies are ahead of plan giving additional comfort on cash flow metrics."
Oct. 19, 2015, 7:47 AM
- PMC-Sierra (NASDAQ:PMCS) +10.8% premarket after Microsemi (NASDAQ:MSCC) offers to buy the company for $11.50/share, or ~$2.4B, in an offer MSCC says is a "superior" proposal over last week's $2B offer from Skyworks Solutions' (NASDAQ:SWKS).
- Under MSCC's offer, PMCS shareholders would get $8.75 in cash and 0.0736 of a share of its stock for each PMCS share held; MSCC's offer represents a ~12% premium to PMCS's Friday close and ~50% above PMCS’ price on Oct. 5 before it agreed to the bid from SWKS.
- MSCC says a takeover of PMCS would let it expand its product offering and allow the combined company save more than $100M/year in expenses.
Oct. 6, 2015, 12:57 PM
- Skyworks (NASDAQ:SWKS) has tumbled towards $75 after announcing it's buying storage and telecom IC vendor PMC-Sierra (NASDAQ:PMCS) for $2B in cash on hand. (PR)
- Fellow RF chipmaker Avago (AVGO -6.7%), which (thanks to the LSI acquisition) competes against PMC-Sierra in the storage controller market, is also off, as is merger partner Broadcom (BRCM -3.2%), which competes against PMC to an extent in the telecom IC and network processor markets. RF peer Qorvo (QRVO -3.3%) is also getting hit. The Nasdaq is down 1.2%.
- Possibly hurting the group: Skyworks has used the PMC deal to announce it expects FQ4 (calendar Q3) revenue of $880M and EPS of $1.52. That's slightly above prior guidance of $875M and $1.51 and a consensus of $876M and $1.51, but expectations have been high following a long string of beat-and-raise quarters.
- The PMC acquisition expands Skyworks' reach to a slew of non-RF chip markets and enterprise/telecom infrastructure end-markets. It's expected to yield $75M in cost synergies within 12 months of closing (expected in 1H16), and subsequently boost Skyworks' annual EPS by $0.75. Assuming that target is hit, Skyworks is paying 14x forward EPS.
- Update (1:04PM ET): BofA/Merrill is defending Skyworks and Avago, arguing forward P/Es of less than 10 make shares very cheap.
- Update 2 (5:01PM ET): The group staged a comeback in afternoon trading. Skyworks closed down 1.4%, Avago 3.4%, Qorvo 1.1%, and Broadcom 1.6%. The Nasdaq closed down 0.7%.
Oct. 6, 2015, 1:51 AM
- Skyworks Solutions (NASDAQ:SWKS) has agreed to buy PMC-Sierra (NASDAQ:PMCS) for $2B in cash to expand its portfolio, customer base and end market applications.
- PMC shareholders will get $10.50 per share, representing a 37% premium to the stock's closing price of $7.69 on Monday.
- Semiconductor dealmaking has already reached more than $80B in 2015, surpassing every full year on record except 2000, when M&A in the sector hit $115.5B.
- PMCS +33.8% premarket
- Previously: PMC-Sierra +7.8%; company reportedly exploring sale (Oct. 01 2015)
May 27, 2015, 3:00 PM
- Chip stocks are posting outsized gains (SOXX +4%) amid a 1.3% increase for the Nasdaq after the WSJ reported Avago and Broadcom are in advanced merger talks, sparking hopes for further M&A.
- A Broadcom/Avago deal would be worth ~$67B at current valuations, easily making it the largest in the chip industry's breathless consolidation wave. It would also touch markets ranging from smartphones to set-tops to servers to switches/routers.
- Notable gainers include Avago RF chip peers Skyworks (SWKS +4.3%), Qorvo (QRVO +3.2%), and Anadigics (ANAD +4.9%). Others include Micron (MU +3.8%), SanDisk (SNDK +4.3%), NXP (NXPI +3.5%), Silicon Motion (SIMO +8.3%), Cirrus Logic (CRUS +4.8%), STMicroelectronics, (STM +3.4%), Synaptics (SYNA +3.4%), Atmel (ATML +2.8%), Cavium (CAVM +4.5%), Intersil (ISIL +4.6%), Semtech (SMTC +3.9%), ON Semi (ON +3.8%), Microsemi (MSCC +4.4%), and IDT (IDTI +4.2%).
- Non-chipmakers tied to the industry are also doing well. Standouts include ARM (ARMH +4.4%), Amkor (AMKR +4.6%), ASML (ASML +3.1%), and Rambus (RMBS +3.3%).
- Chip ETFs: SMH, XSD, PSI, SOXL, USD, SOXS, SSG
Jun. 25, 2014, 6:22 PM
- Black Sand Technologies, based out of Austin, was founded in '05 and has raised $28.2M in funding over its history.
- Notably, the product page on Black Sand's site only shows 3G amplifiers, and the most recent PR on its news page is from 2012. All signs suggest Qualcomm (QCOM) is buying the company to strengthen its power amplifier IP and/or engineering talent, as it encroaches on the turf of established vendors such as Skyworks (SWKS), TriQuint (TQNT), RF Micro (RFMD), and Avago (AVGO) with system-level solutions.
- Qualcomm, estimated to have 64% of the 2013 baseband processor market, made a dramatic entry into the amplifier market last year by announcing an RF front end solution (amplifiers included) that promised superior 3G/4G multi-band support and (via technologies such as envelope tracking) power efficiency. Skyworks, TriQuint, and RF Micro all tumbled following the announcement.
Feb. 24, 2014, 9:21 AM
- Skyworks (SWKS) is up 3.2% premarket, Qualcomm (QCOM) is up 1%, and Anadigics (ANAD) is up 3.7% following news RF component vendors TriQuint and RF Micro are merging. The merging companies themselves are up sharply.
- RF Micro/TriQuint, which comes on the heels of Avago/LSI, appears to be fueling hopes of additional consolidation in the RF component space. There might also be expectations rivals will be able to take share, as common customers such as Apple and Samsung try to stay diversified.
- Though Qualcomm's chip unit is best known for its baseband and app processors, it also has a large and growing RF component business, one Qualcomm hopes to expand via its innovative/ambitious RF front end platform.
Nov. 5, 2012, 1:47 PM
RF Micro Devices (RFMD +0.6%) is spending $47.5M in cash to acquire Amalfi Semiconductor, a developer of RF/mixed-signal chips for low-end smartphones. Amalfi specializes in RF CMOS chips, which can be cheaper than traditional gallium arsenide parts. The purchase comes at a time when low-end Android sales to emerging markets are heavily responsible for smartphone growth. Rival Skyworks noted on last week's earnings call it expects the Chinese smartphone market to be a big near-term growth driver.| Nov. 5, 2012, 1:47 PM | 1 Comment