Renesas announces acquisition

Renesas Electronics has signed a definitive agreement to acquire Intersil Corporation, a provider of power management and precision analog solutions. Renesas will acquire Intersil for US$22.50 per share in cash, representing an aggregate equity value of approximately US$3.2 billion.

Having been unanimously approved by both companies’ boards of directors, the transaction is expected to close in the first half of 2017.

The companies say the acquisition will enable the combined company to become a complete solution provider of embedded systems to its customers. By combining Renesas’s microcontroller (MCU) and system-on-chip (SoC) products and technology and Intersil’s power management and precision analog capability, Renesas said it will be well positioned to address some of the exciting opportunities in key areas such as automotive, industrial, cloud computing, healthcare and the Internet of Things (IoT).

The acquisition will also expand Renesas’s product portfolio, particularly for analog devices, where the market is expected to increase by approximately US$3.9 billion by 2020. The transaction is expected to immediately increase both gross and operating margins and be accretive to Renesas’s non-GAAP earnings per share and free cash flows after closing.

“We believe that this compelling and complementary combination will bring significant synergies and cross-selling opportunities as well as a system solution proposition which will pave the way for Renesas to strengthen its position as a leader in the global semiconductor market while delivering value to its customers with a unique product offering,” said Bunsei Kure, representative director, president and CEO of Renesas.