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Chip maker says deal will extend its presence in automotive, security sectors; deal to close by end of 2017.
Qualcomm on Thursday agreed to acquire Netherland’s-based chip maker NXP in a transaction worth $47 billion (€42.96 billion).
U.S.-based Qualcomm said the deal gives it a leading position in the markets for automotive, security, network processing and RF power, and IoT semiconductors, and complements its mobile processor and modem businesses.
"The NXP acquisition accelerates our strategy to extend our leading mobile technology into robust new opportunities, where we will be well positioned to lead by delivering integrated semiconductor solutions at scale," said Qualcomm CEO Steve Mollenkopf, in a statement.
Last year, NXP became the world’s biggest provider of semiconductors for the automotive industry when it closed its $11.8 billion acquisition of Freescale Semiconductor. As well as developing chips for vehicle safety and security, it also counts 14 of the top 15 in-car infotainment companies among its customer base.
"By joining Qualcomm’s leading SoC capabilities and technology roadmap with NXP’s leading industry sales channels and positions in automotive, security and IoT, we will be even better positioned to empower customers and consumers to realise all the benefits of the intelligently connected world," Mollenkopf said.
"The combination of Qualcomm and NXP will bring together all technologies required to realise our vision of secure connections for the smarter world, combining advanced computing and ubiquitous connectivity with security and high performance mixed-signal solutions including microcontrollers," added NXP chief Rick Clemmer.
Under the deal, Qualcomm will commence a tender offer to acquire all of NXP’s issued and outstanding shares for $110 per share. The transaction will be funded through a combination of cash on hand and new debt.
Qualcomm expects to generate annual synergies of $500 million within two years of the deal closing. The combined company is expected to generate annual revenues of more than $30 billion.
"The complementary nature of our technologies and the scale of our portfolios will give us the ability to drive an accelerated level of innovation and value for the whole ecosystem," Clemmer said.
The deal is subject to regulatory approvals and customary closing conditions. Qualcomm said it expects to complete the transaction by the end of 2017.
