RF Micro Devices to buy rival TriQuint Semiconductor for about $1.6 bn

RF Micro Devices Inc, a maker of radio frequency chips used primarily by mobile-handset manufacturers, yesterday struck a friendly deal to buy its rival TriQuint Semiconductor Inc for about $1.6 billion.

Under the all-stock deal, TriQuint shareholders will receive 1.675 shares of the new combined company for every share held, while RF Micro shareholders will receive 1 share of the new entity. The transaction will qualify as a tax-free reorganization.

The offer price represents a premium of 5.4 per cent to TriQuint Friday closing price.

Post closing, shareholders of both will hold 50 per cent each in the new company.

The merger will create a company with revenue of more than $2 billion, and at least $150 million in cost savings, the companies said in a statement.

It will also create new growth opportunities in three large global markets - mobile devices, network infrastructure and aerospace/defense - with scale advantages, innovative new products and a greatly improved operating model.

"With this merger of equals, we will bring under one roof all of the critical RF building blocks necessary to innovate at the heart of what makes mobile mobile - the crucial back-and-forth data flow between the mobile device and the network," said RF Micro CEO and president, Bob Bruggeworth."

"Through this combination of RFMD and TriQuint we form a diversified market leader with a highly compatible combination of products and technologies and a world class team focused on innovation and superior financial results," said TriQuint CEO, Ralph Quinsey.

Quinsey will be the non-executive chairman of the new company, while Bruggeworth will take on the role of CEO.

North Carolina-based RF Micro Devices designs and manufactures high-performance semiconductor components and is a preferred supplier to the world's leading mobile device, customer premises and communications equipment providers.

Its products enable worldwide mobility, provide enhanced connectivity and support advanced functionality in the cellular handset, wireless infrastructure, wireless local area network, CATV / broadband and aerospace and defense markets.

Founded in 1985, TriQuint provides RF solutions and foundry services for the world's top communications, defense and aerospace companies.

Its products help reduce cost and increase performance of connected mobile devices and the networks that deliver critical voice, data and video communications.

The Oregon-based company has manufacturing facilities in the US, Costa Rica, and design centers in North America and Germany.