Chip maker MaxLinear to buy rival Exar Corp for $661.6 mn

Chip maker MaxLinear Inc yesterday struck a deal to buy its rival Exar Corp for about $661.6 million in cash in order to boost growth.

Under the terms of the deal, MaxLinear will pay $13 per share, a 22 per cent premium to Exar closing price.

The total value is around $700 million, or $472 million net of Exar's cash. MaxLinear intends to fund the acquisition with cash from the combined balance sheets and a $425 million loan.

The transaction is expected to be completed in the second quarter this year.

MaxLinear said that the acquisition significantly furthers its strategic goals of increasing revenue scale, diversifying revenues by end customers and addressable markets, and expanding its analog and mixed-signal footprint on existing tier-1 customer platforms.

Exar designs, develops and markets high performance integrated circuits and system solutions for the industrial, infrastructure, automotive and audio / video markets.

Its broad product portfolio includes power management, sensing and signal conditioning, interface, LED lighting, data management and video processing solutions. 

Exar has design centers in Silicon Valley, California and Hsinchu, Taiwan and has sales locations worldwide.

''We are very excited about the combination of these two complementary organizations as we expand our capabilities, reach, and value proposition to our customers,'' said Dr. Kishore Seendripu, CEO of MaxLinear.

''Exar's expertise in power management and interface technologies, along with an extensive distribution platform, should enable us to accelerate our growth, capitalize on cross-selling opportunities and better serve our customers,'' he added.

MaxLinear provides highly integrated radio-frequency analog and mixed-signal semiconductor solutions for broadband communications applications.

The New York Stock Exchange-listed company employs nearly 300 people, and has research and development centers in California, China and India.