Open side-bar Menu
 IC Insights
IC Insights
IC Insights
IC Insights, Inc. is a leading semiconductor market research company headquartered in Scottsdale, Arizona, USA. Founded in 1997, IC Insights offers complete analysis of the integrated circuit (IC), optoelectronic, sensor/actuator, and discrete semiconductor markets with coverage including current … More »

Acquisition Rebound Lifts 2019 to Third-Largest M&A Year

 
February 10th, 2020 by IC Insights

Seven major semiconductor acquisition agreements valued at $1 billion or more increase the total value of all deals by 22% from the previous year, continuing the strong wave of M&A and consolidation among chip suppliers.

Semiconductor merger and acquisition activity strengthened in 2019 after pulling back in the two previous years from historic high levels of M&A agreements in 2015 and 2016.  More than 30 semiconductor acquisition agreements in 2019 had a combined value of $31.7 billion, which was a 22% increase from $25.9 billion in 2018, according to data compiled by IC Insights in its new 2020 edition of The McClean Report—A Complete Analysis and Forecast of the Integrated Circuit Industry.  The 2019 value of semiconductor acquisition agreements reached the third-highest annual total ever, but the year was still far behind 2015 and 2016 (Figure 1).

Figure 1

It appears the pace of semiconductor acquisitions has moved up to a “new normal” level since 2015—perhaps in the $25-30 billion range per year—as consolidation in the chip industry quickens and large suppliers strike deals to add new products and technologies for higher growth this decade, in such areas as machine-learning and artificial intelligence, autonomous vehicles, human recognition, computer vision, virtual/augmented reality, and high-speed wireless connections to the ever-expanding Internet of Things. M&A announcements surged in 2015 with the total value of deals hitting a record-high $107.7 billion, followed by $100.7 billion in acquisition agreements in 2016 (just $59.8 billion of those transactions were completed in the following years because several major ones were dropped after failing to win approval by government regulators).

The average annual value of semiconductor M&A agreements between 2015 and 2019 is more than 4x the average in the prior five-year period (2010-2014)—more than 4.5x if $100.7 billion is used for 2016 announcements.  It is important to note that these purchase agreements cover semiconductor companies, chip divisions, business units, development teams and product lines, intellectual property (IP), process technologies, and wafer fabs.  IC Insights’ M&A list excludes transactions involving semiconductor capital equipment suppliers, material producers, chip packaging and testing companies, and design automation software firms.

Seven of the acquisition agreements in 2019 exceeded $1.0 billion.  Here is where those seven acquisitions rank among the 50 largest semiconductor M&A deals in history.

#9 is now Infineon’s planned purchase of Cypress Semiconductor for $9.4 billion.
#12 is Nvidia’s $6.9 billion deal for interconnect and networking products supplier Mellanox;
#18 is AMS’s pending $5.1 billion takeover of optoelectronics maker OSRAM;
#36 is Intel’s $2.0 billion purchase of AI-chip developer Habana Labs in Israel;
#38 (tied) is NXP’s acquisition of Marvell’s Wi-Fi Connectivity business for $1.8 billion;
#45 is ON Semiconductor’s $1.1 billion purchase of Wi-Fi solutions supplier Quantenna Communications;
#46 is now Apple’s $1.0 billion takeover of Intel’s smartphone modem business.

Report Details:  The McClean Report 2020
Additional details on semiconductor M&A agreements and other trends within the IC industry are provided in the 2020 edition of The McClean Report—A Complete Analysis and Forecast of the Integrated Circuit Industry.  A subscription to The McClean Report includes free monthly updates from March through November (including the 200+ page Mid-Year Update), and free access to subscriber-only webinars throughout the year.  An individual user license to The McClean Report is priced at $4,990 and includes an Internet access password.  A multi-user worldwide corporate license is available for $7,990.

Categories: Mergers & Acquisitions, Semiconductor Market Reasearch

Logged in as . Log out »




© 2024 Internet Business Systems, Inc.
670 Aberdeen Way, Milpitas, CA 95035
+1 (408) 882-6554 — Contact Us, or visit our other sites:
TechJobsCafe - Technical Jobs and Resumes EDACafe - Electronic Design Automation GISCafe - Geographical Information Services  MCADCafe - Mechanical Design and Engineering ShareCG - Share Computer Graphic (CG) Animation, 3D Art and 3D Models
  Privacy PolicyAdvertise