Shares in Dialog Semiconductor 0OLN,
rose 21% Monday after Japanese maker Renesas Electronics raised its UK-based supplier Apple by 4.9 billion euros ($ 5.9 billion).
The cash offer of EUR 67.50 per share represents a 20% premium over the closing price of the Dialog share on Friday and a 52% premium over the three-month weighted average, the company said in a statement.
DLGNF Dialogue,
whose customers include Apple AAPL,
Samsung Electronics 005930,
Panasonic 6752,
and Xiaomi 1810,
he said the deal was a “compelling opportunity” for its shareholders and that his board would unanimously recommend the offer.
Actions in Dialogue DLG,
rose to 21% in early European trading on Monday, before returning to trading by 16.57% higher.
“We believe that Renesas’ strong footprint in microcontrollers and system chips would be complementary to make the most of Dialog products,” UBS analysts said in a note to customers on Monday.
Renesas 6723,
one of the world’s largest car chip suppliers, saw its stock fall 3.61% Monday in Tokyo, while investors digested the transaction, which is the company’s latest four-year acquisition period. This included the takeover by the Japanese company of the American company Integrated Device Technology for 7.2 billion dollars in 2018.
The acquisition of Dialog marks the second time that a British chip manufacturer has become the target of overseas bidders after Nvidia NVDA,
in September 2020 bought 9984 of SoftBank Group,
Arm chips division for $ 40 billion.
The agreement comes amid a surge in the semiconductor industry in recent months. In October, AMD AMD,
I bought rival Xilinx XLNX,
in a $ 35 billion share transaction, while in January Intel sold its NAND memory unit to SK Hynix for $ 9 billion.
The takeover of the Dialogue could draw the attention of UK regulators, who last year announced the biggest shake-up of takeover rules in two decades in a bid to protect strategic assets from hostile bidders.
Read: Bids to buy in UK companies are getting tougher as ministers close the takeover of “back doors” in countries such as China, Russia and the US
The UK competition regulator said in January it would launch an investigation into Nvidia’s takeover of Arm, including whether it would have an “incentive to withdraw, increase prices or reduce IP quality [intellectual property] licensing services for rivals Nvidia. ”
Read: Nvidia’s $ 40 billion takeover will be investigated by UK regulator
“Although the agreement is unlikely to face control by UK regulators, the fact that the CMA [Competition and Markets Authority] looking at the recent agreement between Nvidia to acquire Arm Holdings from SoftBank, there is a risk of seeing them take a look at it, “said Michael Hewson, chief market analyst at CMC Markets UK, in a note to customers. Months.
UBS analysts said that given the small size of the Dialogue and the fragmentation of the market in the auto / industrial industry, they believed that the antitrust risk was probably “relatively low”.