TriQuint Semiconductor Inc. and RF Micro Devices Inc. agreed to
combine in a deal that will form a new company with a broader range
of offerings of mobile-related products and services for the
network infrastructure and defense/aerospace industries.
Under the deal, which is expected to close in the second half of
2014, TriQuint shareholders will receive 1.675 shares of the new
company and RF Micro shareholders will receive one share the new
company for each TriQuint or RF Micro share held.
The companies are calling the deal a merger of equals. The
companies said the transaction represents an implied price of $9.73
for each TriQuint share, a 5.4% premium to Friday's close.
The combined company is expected to generate combined revenue of
more than $2 billion. As of Friday's close, RF Micro's market value
was $1.64 billion, while TriQuint's was $1.48 billion.
RF Micro Chief Executive Bob Bruggeworth will serve as CEO of
the new company and TriQuint CEO Ralph Quinsey will serve as
non-executive chairman. TriQuint Chief Financial Officer Steve
Buhaly will serve as finance chief and RF Micro CFO Dean Priddy
will serve as executive vice president of administration. The board
will be made up of 10 directors, with five directors from the
existing board of each company.
The combination is expected to achieve at least $150 million in
cost synergies; $75 million in annualized synergies exiting the
first year after closing and an additional $75 million exiting the
second year.
TriQuint has been under pressure from activist investor
Starboard Value LP, which in October called on the company to make
changes or consider selling its mobile power amplifier business,
saying the unit was a drag on the company. Starboard in December
nominated its own slate of board candidates, claiming significant
changes were needed to turn around the chip maker's "prolonged
underperformance."
The companies plans to provide more details in a conference call
set for 8:30 a.m., New York time.
Shares of both companies were halted premarket.
Write to Tess Stynes at tess.stynes@wsj.com
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