23 April 2021
Skyworks acquiring Silicon Labs’ Infrastructure & Automotive business for $2.75bn
Skyworks Solutions Inc of Woburn, MA, USA (which manufactures analog and mixed-signal semiconductors) has agreed to acquire the Infrastructure & Automotive business of Silicon Laboratories Inc of Austin, TX, USA, a provider of silicon, software and solutions, in an all-cash asset transaction valued at $2.75bn.
Over the past two decades, the Infrastructure & Automotive business has provided solutions to a highly diversified customer base. The acquisition encompasses the technology portfolios and related assets of Silicon Labs’ power/isolation, timing and broadcast product lines, which are highly complementary to Skyworks’ connectivity portfolio.
The acquisition is expected to accelerate Skyworks’ expansion into the industry’s most important growth segments, including electric and hybrid vehicles (EV/HEV), industrial and motor control, power supplies, 5G wireless infrastructure, optical data communication, data center, automotive, smart home and several other applications. Skyworks reckons that it will be uniquely positioned to address a combined market opportunity approaching $20bn annually.
Mark Thompson, senior VP of Silicon Labs and general manager of the Infrastructure & Automotive business, will join Skyworks, reporting directly to Skyworks’ president & CEO Liam K. Griffin. In addition, about 350 staff, including the senior management team of the business, are expected to join Skyworks upon completion of the transaction.
“This acquisition will broadly expand our capabilities across high-growth end markets including automotive, communications and industrial, creating new and highly compelling opportunities for Skyworks,” says Griffin. “By leveraging our global sales channels, operational scale and deep customer relationships, Skyworks is well positioned to drive above-market growth, while diversifying revenues, expanding margins and delivering strong returns in earnings and cash generation,” he believes.
“With our companies’ shared cultures of design excellence and customer collaboration, I am confident that the Infrastructure & Automotive team will continue their decades-long history of delivering industry-leading innovations,” says Silicon Labs’ CEO Tyson Tuttle. “Silicon Labs and Skyworks will partner to ensure a seamless transition for customers, suppliers and employees.”
Skyworks expects the transaction to be immediately accretive and to accelerate the path to it achieving its target financial model. The transaction, which is expected to close during third-quarter 2021, has been approved by the boards of directors of both companies and is subject to customary closing conditions, including regulatory approvals.
Skyworks expects to fund the transaction with a combination of cash on hand and committed debt financing arranged by J.P. Morgan.