Microchip Technology has signed a definitive agreement to acquire Microsemi for $68.78 per share in cash i.e $8.35 Billion, after accounting for Microsemi’s cash and investments, net of debt, on its balance sheet at December 31, 2017, this puts Microsemi's value at $10.15 Billion.
The transaction is expected to be immediately accretive to Microchip’s non-GAAP earnings per share. Based on currently available information, Microchip anticipates achieving an estimated $300 million in synergies in the third year after close of transaction. Microchip plans to finance the transaction with approximately $1.6 billion of cash from the combined company balance sheets, approximately $3.0 billion from Microchip’s existing line of credit, approximately $5.0 billion in new debt and $0.6 billion of a cash bridge loan.
The Board of Directors of each company has unanimously approved the acquisition. Subject to approval by Microsemi stockholders, customary regulatory approvals and other closing conditions, the transaction is expected to close in the second quarter of calendar 2018.