Boston, MA 02/25/2014 (wallstreetpr) – Hillsboro TriQuint Semiconductor (NASDAQ:TQNT) has announced it has entered into a record breaking merger with RF Micro Devices a deal that is thought to be worth $2 billion in net annual revenue. The deal is expected to split the ownership of the company into half, with one half of the ownership going to TriQuint shareholders and the remaining half going to RF Micro Devices shareholders.
TriQuint Semiconductor (NASDAQ:TQNT) shares were up in the market by 26% as a result of the positive news, resulting in the company market cap reaching a high of $1.9 billion. TriQuint Chief Executive officer was extremely jubilant of the new merger as it will provide the company the opportunity to scale new heights amidst fierce competition from Avago and Skyworks.
TriQuint enters into the merger with a total of 900 employees at its Hillsboro headquarters, its largest customer as of the moment is Apple Contractor Foxconn which accounts up to a third of its total sales. The merger is expected to result in $150 million worth of saves in operational costs with the two company’s maintaining their headquarters
The deal could be challenging on TriQuint point of view as it currently has an excess in capacity, in its gallium arsenide production manufacturing, the deal with RF Micro devices expected to make the situation even worse. What happens in each site won’t be decided as of now as the deal is expected to close in the next 4 to 6 months.
The merger presents TriQuint Semiconductor (NASDAQ:TQNT) with the capacity to meet increasing demand for mobile devices of which it has not been able to meet in the recent past due to inadequacy in production. The merger is sure to enable more chips that the smartphone industry currently demands.
TriQuint Semiconductor (NASDAQ:TQNT) was one of the better performers on Monday trading session climbing by 26.11% to close the day at a high of $11.64.
