TDK To Buy InvenSense For $1.3 Billion As Chip M&A Continues | Stock News & Stock Market Analysis

Japanese electronics company TDK said Wednesday that it plans to buy motion-sensing chipmaker InvenSense (INVN) for $1.3 billion to pursue new opportunities in sensors for automobiles and internet-connected devices.

TDK said the all-cash deal will strengthen its position as a major player in sensor systems.

TDK will pay $13 a share for InvenSense, which is a 20% premium to its closing price on Tuesday and 52% premium to its 60-day volume-weighted average trading price. TDK expects to complete the acquisition in the second quarter of its fiscal year ending March 31, 2018.

InvenSense stock was up 17.6% to 12.75 on the stock market today.

IBD’S TAKE: InvenSense has been a laggard of late among semiconductor stocks. It is not among the eight chip stocks on the IBD 50 list of top growth companies.

The transaction will combine inertial, pressure, microphone and ultrasonic wave sensor technologies from InvenSense with TDK’s pressure, temperature, electric current and other sensors.

San Jose, Calif.-based InvenSense is best known as a provider of motion sensors for smartphone makers, including Apple (AAPL) and Samsung. It also makes sensors for wearables, game devices, cameras and drones.

TDK plans to pursue sensor fusion, the combination of multiple sensor technologies and software for advanced products.

“Our strategic goals are aligned, and we are confident that together with TDK we will accelerate our roadmap to provide next-generation sensor technologies in key fields for the world’s most innovative companies,” InvenSense CEO Behrooz Abdi said in a statement.

The TDK-InvenSense deal is the latest in a flurry of chip M&A activity this year.

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On Nov. 21, Macom Technology Solutions (MTSI) announced plans to buy Applied Micro Circuits (AMCC) for $770 million.

On Nov. 2, Broadcom (AVGO) announced a deal to acquire Brocade Communications Systems (BRCD) for $5.9 billion.

On Oct. 27, Qualcomm (QCOM) announced plans to buy NXP Semiconductors (NXPI) for $39 billion in the largest semiconductor M&A deal ever.


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