According to Dialog’s press statement, the deal will see Atmel’s shareholders receive $4.65 in cash and 0.112 percent of a share in Dialog Semiconductor American Depository shares for each Atmel common share they hold. He also expects annual savings of $150 million within two years.
Advertisement
Atmel Corporation NASDAQ:ATML is a designer, developer and supplier of microcontrollers.
The combined company will have “a strong presence” in mobile, industrial and automotive markets and give it a “leading position” in the Internet of Things, he said.
The Atmel Corp. sale process was led by investment banker Qatalyst Partners, which apparently attracted multiple bidders and where Dialog won the second bidding.
This accounts for a 43% premium over Atmel’s closing price of 7.27 on Friday.
Do you own shares of Atmel Corporation (NASDAQ GS: ATML)?
The takeover extends a record year for semiconductor deals, as chipmakers combine to counter slowing growth and increasing costs.
The stock price of Atmel Corporation declined 8.67% over the last 200 days, and is in unstable down trend.
Both company’s boards have approved the transaction, which is expected to be finalized by the first quarter of 2016. However, given the volatility of Dialog shares, we would assign some small probability to another entity coming in with a second bid, perhaps in all cash at something in the $8.00-$9.00 range to at least give Atmel shareholders another option. He goes on to say, “The two companies together would seem to be good, but Dialog [is] getting hammered even though Atmel is up a little bit”. This will create a comprehensive company worth $2.7 billion, in terms of yearly revenue. Intel is now completing its $16.7bn acquisition of Altera, Avago is in the midst of spending $37bn on Broadcom and Microchip is spending $839million to bring Micrel into its stable.
Advertisement
Based in San Jose, California, Atmel creates minimal cpus known as microcontrollers whose objective is in a number of electronic products and also other components within this attached gadget areas. The company intends to fund the transaction with a combination of existing cash, $2.1 billion of new debt and the issuance of about 49 million ADSs expected to be listed on the New York Stock Exchange or the Nasdaq stock market.
