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Atmel Joined the Semiconductor Consolidation Trend Last Month

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Dialog and Cypress had their eyes on Atmel

Atmel (ATML), a US-based manufacturer of MCU (microcontroller), is an active player in developing advanced semiconductors for IoT (Internet of Things) devices. MCUs are small chips that are designed for embedded systems and have the functionalities of a computer like memory, a processor, and programmable input and output peripherals.

Recently, Atmel attracted the attention of semiconductor manufacturers Dialog and Cypress (CY). On September 20, 2015, Dialog Semiconductor agreed to buy Atmel for ~$4.6 billion. After a few days, news spread in the market that rival Cypress had made a counter bid for Atmel. On September 28, 2015, Cypress issued a statement denying the bid rumors. This series will discuss what made Atmel an attractive target for acquisition.

IC Insights forecasts worldwide MCU shipments to grow from 18.6 billion units in 2014 to 27.3 billion units in 2019, growing at a compounded annual rate of 7.9%.

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About Atmel

Founded in 1984, Atmel has a broad portfolio of MCUs and complementary products such as touch solutions, nonvolatile memory products, radio frequency, and mixed-signal components. The company provides connected solutions for electronic devices used in industries, cars, home, road, hospital, computers, and communications. Arrow Electronics, Avnet, and Samsung Electronics (SSNLF) are some of the key customers of Atmel. In fiscal 2014, the company employed around 5,200 employees and reported revenue of $1.4 billion.

About Dialog

Founded in 1981, UK-based Dialog manufactures digital, mixed-signal, and analog circuits for automotive, industrial, computers, communications, and customers. The company employed 1,360 employees and reported revenues of $1.15 billion in fiscal 2014, of which ~85% came from China. Apple (AAPL), Panasonic, and Samsung are some of its key customers.

About Cypress

Founded in 1982, US-based Cypress supplies nonvolatile memory products, touch products, and mixed-signal solutions. Its products are used in verticals such as computers, mobile and communication devices, and other electronic devices used in industries, homes, cars, and military. In fiscal 2014, the company employed 3,350 employees worldwide and reported revenue of $725.49 million.

The iShares Russell 1000 Growth ETF (IWF) has 0.03% exposure to Atmel and 6.39% to Apple.

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