Analog Devices (ADI) announced it was going to purchase Linear Technology in a cash and stock transaction worth $30 billion today.
ADI manufactures analog mixed-signal and digital signal processing, integrated circuits. Technologies researched by ADI are used to convert phenomenon like sound, light, temperature, pressure and motion into electrical signals.
On the other hand, Linear Technology is a company dedicated to providing the bridge from our analog world to the digital electronics through high-performance analog integrated circuits. Their products range includes communications, networking, industrial, automotive, computer, medical, instrumentation, consumer, and military and aerospace systems
Once Analog Devices Inc. acquires Linear Technology, it is said that ADI will become the premier global analog technology company with an anticipated $5 billion yearly revenue.
Both companies are looking forward the agreement
Under the provisions of the agreement, Linear Technology shareholders will receive $46.00 per share in cash and 0.2321 of a percentage of Analog Devices common stock for each share of Linear Technology common stock they hold at closing. Linear Technology investors will still own approximately 16% of the combined company on a fully-diluted basis
“The combination of Analog Devices and Linear Technology brings together two of the strongest business and technology franchises in the semiconductor industry…Our highly complementary portfolios of industry-leading products will enable us to solve our customers’ biggest and most complex challenges” said Vincent Roche, President and Chief Executive Officer of Analog Devices.
ADI will partly fund the transaction with approximately 58 million new shares of Analog Devices Inc. common stock, meaning about $7.3 billion of new long-term debt. The rest will be paid using the combined company’s balance sheets cash.
The transaction has been approved unanimously by the board of directors of both companies, and the deal is set to be concluded on the first half of 2017. However, the deal is also subject to regulatory approvals in various jurisdictions, the endorsement of Linear Technology’s shareholders, and other customary closing conditions.
Today, July 26, both companies announced that they would host a conference call to discuss details of the transaction. Roche also spoke about the profound respect and admiration they have for the franchise created by Linear Technologies. He also emphasized that he is very convinced that the fusion of both companies will bring a trusted leadership in the industry.
A live webcast and the accompanying presentation relating to the transaction will be available in the “Investors” section of Analog Devices’ website at www.analog.com in advance of the conference call.
Source: Analog Devices