Wednesday, February 3, 2010, 1:03pm MST
Microchip Technology to purchase Silicon Storage Technology for $284M
Phoenix Business Journal
Microchip Technology Inc. will pay about $284 million to buy Silicon Storage Technology Inc.
Both the boards of Chandler-based Microchip (NASDAQ: MCHP) and Sunnyvale, Calif.-based SST (NASDAQ: SSTI) have approved the purchase, which would be for a premium of $2.85 per share for SST’s stock. The companies announced the deal Wednesday.
The move means Microchip was able to pick up a company that had a previous deal with Technology Resources Holdings Inc., which SST said it terminated prior to talking with Microchip.
“Throughout our strategic process, we have demonstrated our commitment to shareholder interests, and we are very pleased with this result,” said Ronald Chwang, chairman of the SST strategic committee that was looking at a potential merger or sale. “As a result of our rigorous and comprehensive process, we are confident that the proposed merger with Microchip achieves the best transaction for all SST shareholders.”
The move allows Microchip to access SST’s Superflash technology and patent portfolio for advanced microcontrollers, a critical element of that company’s success.
“This acquisition enables Microchip to gain earlier access to SST’s advanced technologies, as well as the ability to customize technology variants that can give us an advantage over competing technologies,” said Steve Sanghi, president and CEO of Microchip.
The deal is expected to be completed in the second quarter of 2010.
The deal was announced along with Microchip’s third-quarter results that saw the company’s net income slip slightly but still showed large growth in its revenue.
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