US semiconductor maker Microsemi has agreed to buy Californian timekeeping technologies developer Symmetricom for around US$230m.
Its US$7.18 per share cash tender offer for Symmetricom, whose products are used to align GPS satellites, represents a 49%…
US semiconductor maker Microsemi has agreed to buy Californian timekeeping technologies developer Symmetricom for around US$230m.
Its US$7.18 per share cash tender offer for Symmetricom, whose products are used to align GPS satellites, represents a 49% premium on the stock’s average closing price 90 days before the announcement.
The boards of both companies have given their approval for the deal, which is subject to rival bids from third parties until 8 November.
Microsemi makes aerospace RF semiconductors and its CEO James Peterson said the merger would create the largest and most complete timing portfolio in the industry.
“From source to synchronisation to distribution, Microsemi will offer an end to end timing solution for an expanded range of markets, driving increased dollar content opportunity and revenue growth,” he said.
For Symmetricom, the deal will propel its technology into broader markets and accelerate the adoption of its new chip scale atomic clock (CSAC) technology, designed to be smaller and less power demanding than its rivals.
Subject to regulatory approvals, the companies expect to close the transaction before the end of this year. There is also a termination fee of US$10.4m, which could be lowered to US$5.05m under certain unspecified conditions.
Morgan Stanley provided a fairness opinion to Microsemi, and O’Melveny & Myers is acting as its legal adviser.
Jefferies is financial adviser for Symmetricom and Latham & Watkins is providing legal advice.
Symmetricom reported a net loss of US$2.7m for 2013, compared with a net income of US$11.4m last year.
It also posted net revenues of US$211m for the 12 months to 30 June 2013, compared with US$237.7m in 2012.
In June 2013 the group launched a strategic restructuring plan to improve its operational and financial performance, including cutting its workforce by around 12%.
It expects to fully implement this plan by December and, upon completion, aims to reduce annual costs by roughly US$13m.
