Acquisitions · Semiconductors (analog and power)

Renesas buys US chipmaker Intersil for about $3.2 billion

Buyer: Renesas Electronics (Tokyo)
Target: Intersil, Milpitas, California
Value: About $3.2B equity value ($22.50 a share in cash; about ¥321.9B)
Status: Agreed on September 13, 2016; completed on February 24, 2017.
Date: 2016-09-13

Renesas Electronics agreed to buy Intersil, a maker of power management and precision analog chips based in Milpitas, California, for $22.50 a share in cash. The equity value was about $3.2 billion. Renesas paid with cash on hand.

Why it matters

The deal pairs Intersil's analog and power chips with Renesas's microcontrollers, letting Renesas offer fuller chip sets to car and industrial customers.

Deal terms

The $22.50 price was about 43.9% above Intersil's unaffected share price on August 19, 2016. The deal needed approval from Intersil's shareholders and from governments, and the companies expected it to close in the first half of 2017.

Planned gains

Renesas expected synergies of $170 million from higher sales and lower costs, and said the deal would lift its gross and operating margins immediately. It targeted automotive, industrial and Internet of Things markets, where Intersil's chips are used alongside Renesas's microcontrollers and system-on-chip products. It also expected the analog chip market to grow by about $3.9 billion by 2020.

Sources

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