LONDON Analog circuit designer and manufacturer Intersil Corp. (Milpitas, Calif.) has announced that it has entered into a definitive agreement to acquire Techwell Inc. (San Jose, Calif.).
The purchase is being made through a cash tender offer at $18.50 per share. Net of Techwell's cash and equivalents, the transaction values Techwell, which is traded in the Nasdaq exchange, at approximately $370 million.
Techwell is a fabless semiconductor company that designs and sells mixed signal video solutions for the security surveillance and automotive infotainment markets. It has more than 200 employees in the U.S., China, Japan, South Korea and Taiwan.
"Techwell's team and products will expand our leadership in two high-growth industrial markets," said Dave Bell, Intersil's president and CEO, in a statement. "The addition of Techwell's mixed-signal video products will help our customers build solutions that improve performance, reduce overall cost and shorten time-to-market. In addition, the acquisition will significantly increase our overall industrial business, which will become our largest end market at approximately 31 percent of revenue," continued Bell.
Intersil has received a financing commitment of $390 million from Morgan Stanley Senior Funding Inc. and intends to finance the deal through debt. Morgan Stanley is acting as financial advisor to Intersil in connection with the acquisition, and Dechert LLP is acting as Intersil's legal counsel.
The takeover has already been unanimously approved by Techwell's board of directors, and Techwell's board has recommended that Techwell shareholders accept the offer of $18.50 per share. Techwell's directors, entities affiliated with Technology Crossover Ventures, and certain executive officers of Techwell representing approximately 23 percent of the outstanding shares have already agreed to tender their shares into the offer.
The acquisition is expected to close during Intersil's second quarter and is subject to customary regulatory approvals and the satisfaction of other transaction conditions including the tender of at least 50 percent of Techwell's outstanding shares.