Integrated Device Technology (IDT) and Integrated Circuit Systems (ICS) have signed a merger agreement. IDT is buying ICS for $1.7 billion in cash and stock.
The merger agreement has been unanimously approved by the boards of directors of both companies. Shareholders of ICS will receive 1.300 shares of IDT common stock as well as $7.25 of cash for each share of ICS stock.
About 70 percent of Integrated Device’s revenue now comes from semiconductors used in communications equipment, Bourekas said. After the transaction is completed, more than 30 percent of sales will come from the computing market and 10 percent will come from semiconductors used in consumer electronics.
Santa Clara, California-based Integrated Device’s revenue last year was $390.6 million, and Norristown, Pennsylvania-based Integrated Circuit System reported 2004 sales of $272.1 million.
“IDT has established a solid reputation for developing vital semiconductor solutions targeting various communications infrastructure applications, including wireline, wireless and enterprise,” said IDT President and CEO Greg Lang. “Likewise, ICS has excelled in providing timing technology to consumer, PC and DIMM customers. We believe that the merger will enable customers to benefit from a stronger company with a diverse product portfolio and enhanced resources.”
“The merged company will have an outstanding base of technology, customers and talent to pursue growth opportunities in communications, computing, and consumer market segments,” he added. “Combining our resources will allow us to pursue these opportunities more effectively than we could as separate entities.”
About 46% of the combined company will be owned by ICS shareholders. Under the agreement, ICS Chief Executive Officer Hock Tan will become chairman of IDT.
Chris is a staff writer for Murdok. Visit Murdok for the latest ebusiness news.
