Boston, MA 02/24/2014 (wallstreetpr) – RF Micro Devices Inc (NASDAQ:RFMD) is to merge with TriQuint Semiconductor (NASDAQ:TQNT) to create a company of more than $2 billion in annual revenue.
The radio frequency chip makers, in a merger of equals, have entered into an all stock deal today. According to the deal, shareholders of TriQuint Semiconductor (NASDAQ:TQNT) will get 1.575 shares of the new company for each of their shares and the shareholders of RF Micro will be liable to get one share each. With this, TriQuint shares are adding up to an implied price of $9.73 each which means around $1.6 billion or a 5.4% premium over the shares’ closing price on Feb 21, 2014.
New Roles
The companies said in a statement that with this deal, the two are expecting to save expenses of as much as $150 million. The combined company will have its own name and its Chief Executive Officer will be Bob Bruggeworth, the present CEO of PF Micro. As far as TriQuint Semiconductor (NASDAQ:TQNT)’s CEO is concerned, he will play the role of non-executive chairman in the new company.
Braggeworth said in a statement that the world is seeing an exponentially growing demand in mobile data. He sees the merger of equals as an important decision which gathers together all the critical R.F.’s building blocks of mobile innovation to contribute to development of mobiles. It is, he said, necessary as it brings together mobile device and network closer to each other. On the other hand, TriQuint Semiconductor (NASDAQ:TQNT)’s Quinsey sees the merger as an opportunity to create a diversified market leader.
Shareholders’ Support
Shareholders of both RF Micro Devices Inc (NASDAQ:RFMD) as well as TriQuint see this deal as a positive move toward success. While shares of TriQuint perked up by almost 19% in the morning hours trading, shares of R.F. Micro also rose 15%.
RF Micro Devices Inc (NASDAQ:RFMD)’s financial adviser was Bank of America Corp (NYSE:BAC)’s Merill Lynch and that of TriQuint Semiconductor (NASDAQ:TQNT) was Goldman Sachs Group Inc (NYSE:GS).
