News Column

Infineon snaps up chip firm for $3bn in firm's biggest deal ever

August 21, 2014

JENS HACK



MERGER-shy German chipmaker Infineon has agreed to buy California-based International Rectifier for about $3bn (1.81bn) in cash, Infineon said yesterday, in its biggest-ever acquisition.


Terms call for it to pay $40 per share for the US company, a maker of power-management circuits used in everything from computers to appliances, automobiles, lighting and aircraft.


Shares of International Rectifier rose as high as $39.50 following the news. In the late afternoon, the stock was trading at $39.06, a gain of $12.51 or 47 per cent on the day on the New York Stock Exchange.


Infineon shares fell 1.72 per cent in after-hours trade on the Frankfurt exchange.


The stock had closed down 1.38 per cent ahead of the announce-ment, while those of several possible targets, including International Rectifier rose, following reports that Infineon was preparing to buy a US chipmaker.


Infineon, whose chips activate car airbags, enable cruise control, manage power supplies and cut vehicle emissions, has shunned major takeovers since it was spun off from engineering conglomerate Siemens in 1999.


Infineon said the merger would complement its own range of highpowered chips with International Rectifier's low-power, energy efficient chips.


Reuters


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Source: City A.M. (UK)


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