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Microsemi buys Actel for Rs.2,007.93 crore

Posted: 06 Oct 2010     Print Version  Bookmark and Share

Keywords:FPGA market  acquisition  mixed-signal chip maker 

Analogue and mixed-signal chip maker Microsemi Corp. forays into the FPGA market by entering into a definitive agreement to acquire Actel Corp. for Rs.975.01 ($20.88) per share through a cash tender offer. The total transaction value is approximately Rs.2,007.93 crore ($430 million), net of Actel's projected cash balance at closing.

Based in Mountain View, Calif., Actel is a supplier of field programmable gate arrays (FPGAs). Actel competes against Altera, Lattice, SiliconBlue and Xilinx. Now, Microsemi will compete in the tough FPGA fray.

Observers were scratching their heads about the deal. It was a complete surprise. Analogue and FPGAs are completely different markets.

"We believe the addition of Actel will deliver compelling synergies to Microsemi," said James J. Peterson, Microsemi's president and chief executive, in a statement.

"Actel will bring the most widely-used mixed-signal, radiation tolerant FPGA products in the aerospace and defence markets today, and the company's products will allow Microsemi to extend its growing system-level capabilities,'' he said. ''As Microsemi continues to move up the value chain in offering its customers system solutions that are better, faster, and more-cost effective than they can build themselves, Actel's highly-integrated solutions will be an integral component in enabling this growth."

Microsemi expects significant synergies from this immediately accretive transaction. Based on current assumptions, Microsemi expects the acquisition to be Rs.10.27 ($0.22) to Rs.13.07 ($0.28) accretive in its first full calendar year ending December 2011.

For the September quarter, net sales for Microsemi are expected to range from Rs.681.76 crore to Rs.700.44 crore ($146 to $150 million). As of this date, Microsemi remains comfortable with its previously announced non-GAAP diluted earnings per share guidance for its fourth Fiscal quarter 2010 of Rs.15.41 ($0.33) to Rs.16.34 ($0.35).

No approval of the shareholders of Microsemi is required in connection with the proposed transaction. Terms of the agreement were unanimously approved by the boards of directors of both Microsemi and Actel.

- Mark LaPedus
EE Times

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