Chipmaker Skyworks To Acquire PMC-Sierra For $2B In Cash

Chipmaker Skyworks Solutions Inc. has agreed to buy PMC-Sierra Inc. -- another semiconductor manufacturer -- for $2 billion in cash, the companies announced Tuesday. Skyworks, which manufactures chips used in aircraft and security systems and also supplies Apple Inc., will pay PMC-Sierra shareholders $10.50 per share -- a 37 percent premium to Monday’s close of $7.69 on the Nasdaq.

“With our acquisition of PMC, Skyworks will be uniquely positioned to capitalize on the explosive demand for high performance solutions that seamlessly connect, transport and store Big Data,” David Aldrich, chairman and CEO of Skyworks, said in a statement, adding that the acquisition will broaden its consumer base.

“Specifically, we plan to leverage PMC’s innovative storage systems, flash controllers, optical switches and network infrastructure solutions,” Aldrich added.

The Sunnyvale, California-based PMC-Sierra manufactures semiconductors for telecommunications networks and storage.

“Together, we plan to develop a wider range of leading-edge solutions for our customers, target new growth vectors and enable some of the most exciting networking and storage platforms in the world, while delivering immediate value for our shareholders,” Greg Lang, president and CEO of PMC, said in the joint statement.

The deal is expected to close in the first half of 2016, the companies said.

In recent months, the semiconductor industry has witnessed a series of consolidations. Intel Corp., the world’s largest manufacturer of chips, announced in June that it would buy Altera Corp. for $16.7 billion. Later, in May, Avago Technologies Ltd. announced a $37 billion bid for its rival Broadcom Corp. -- one of the biggest deals in the sector.

According to data compiled by Bloomberg, a total of 39 deals valued at $83.5 billion have been announced in the sector, surpassing every full year on record since 2000.