Analog Devices to Acquire Hittite for $2 Billion

Analog-Devices-HittiteAnalog Devices and Hittite have entered into a definitive agreement whereby ADI will acquire Hittite for approximately $2 Billion, at $78 per share. The closing price of Hittite’s common stock on June 6, 2014 was $60.56 per share. ADI expects to fund the acquisition through a combination of cash on hand and short-term debt financing. The Boards of Directors of each company have approved the transaction, which is expected to close near the end of ADI’s third fiscal quarter of 2014, subject to regulatory approvals and other customary closing conditions. The transaction is expected to be accretive to ADI’s non-GAAP earnings per share.

This is an interesting acquisition by ADI as Hittite strengths in the RF, Microwave and Millimeter wave technologies complements ADI’s. They will now be able to address more customers in the industrial, communications infrastructure, automotive, defense and aerospace markets.

ADI also reaffirmed financial guidance for its third quarter of fiscal year 2014, for revenue to increase in the range of 1% to 5%, and excluding any one-time items, for diluted earnings per share to be in the range of $0.60 to $0.64. ADI and Hittite hosted a joint conference call on June 9, 2014 at 8am ET to discuss the acquisition. Presentation slides and playback of the call can be found at http://investor.analog.com

This is the 3rd Big Merger/Acquisition in the RF & Microwave Industry this year. First there was RFMD and TriQuint, followed by Aeroflex by Cobham and now Hittite by ADI.