Low power IOT manufacturer ISSC Technologies maker swallowed up.
US based Microchip Technology has signed an agreement to buy Taiwan based ISSC Technologies for $328.5m to strengthen its present in Internet of Things (IoT) market.
ISSC Technologies manufactures low power Bluetooth and advanced wireless solutions for the IoT market.
It supplies wireless solutions while its KleanWire technology is used in different Bluetooth products including wireless Headset, Speaker, Connectivity, and HID products.
Microchip Technology supplies microcontroller, mixed-signal, analogue and Flash-IP solutions, and plans to cash in from IoT growth.
Microchip Technology COO Ganesh Moorthy said ISSC's deep domain knowledge in Bluetooth and wireless technologies, and strong position in the Consumer markets, complement many of Microchip's initiatives in wireless and IoT areas.
"We believe that combining ISSC's strengths in wireless products and technology with Microchip's brand, channel and operational strengths will enable significant cross selling opportunities," Moorthy added.
As part of the deal, Microchip will pay $4.74 per share, which would be a premium of 16.7% on ISSC's Thursday share price of $122.50.
After excluding ISSC's cash and investments on its balance sheet of about $34.2m the deal value is worth $294.3m.
ISSC chairman Max Wu said, "We believe that this acquisition provides the best vehicle for us to realize significant value for ISSC shareholders, as well as the opportunities from scale of the much stronger sales and manufacturing platforms of Microchip."
Microchip president and CEO Steve Sanghi said the transaction represents the first major overseas acquisition by Microchip and the purchase will be funded with a portion of Microchip's foreign cash and will not require any additional borrowings from company's line of credit.
"We believe the combination of a very strategic transaction that provides low power Bluetooth technology, ISSC's strengths and capabilities and our use of foreign cash makes this a compelling transaction for the shareholders of both companies," said Sanghi.