Integrated Device Technology (IDT) and GigPeak announced recently that they have signed a definitive agreement for IDT to acquire GigPeak for a total cash consideration of $3.08 per share, or approximately $250 million in cash. This per share consideration would represent a premium of approximately 22% to GigPeak's current closing share price and is expected to add approximately $16M of quarterly revenue at 70% non-GAAP gross margin for IDT.
The acquisition provides IDT with a highly regarded optical interconnect product and technology business that is complementary to its leadership position in real-time interconnect products while also adding GigPeak's optical interface products portfolio being used by leading companies in the Communications, Cloud Data Center, and Military/Aviation markets. IDT now aim to provide seamless ultra-high speed data connectivity products using electrical, RF, and optical technologies.
The acquisition terms, which were unanimously approved by both the Boards of Directors of IDT and GigPeak, are structured as an all-cash tender offer for all outstanding issued common stock of GigPeak followed by a merger in which its remaining shares would be converted into the same dollar per share consideration as in the tender offer. The transaction is subject to customary conditions, including the tender of the majority of the outstanding shares and the expiration or earlier termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976. It is expected to close during the second calendar quarter of 2017. GigPeak is also expected to be delisted from the NYSE MKT and integrated into IDT thereafter.
