On June 3, Cypress Semiconductor (CY) shares rose ~25% in pre-market trade after the company agreed to a buyout offer from Infineon Technologies. According to a report, Infineon Technologies wanted to buy Cypress Semiconductor amid global uncertainty and China’s sluggish car business. Last week, there were reports that hinted at Cypress’ inclination to become a takeover target. Infineon shares fell 6.5% on June 3.
Infineon to buy Cypress
Infineon Technologies has formed an agreement to buy Cypress Semiconductor, including its debt. The deal has valued Cypress at more than $10 billion or 9 billion euros. Cypress shareholders would get ~$23.85 per share—a premium of ~34% over the stock price on May 31 and ~50% more than the stock price on May 28 when the chipmaker considered selling itself after receiving takeover interest.
The deal is set to generate cost synergies of 180 million euros annually by 2022 and revenue synergies of more than 1.5 billion euros in the long term.
Stock price movement
Cypress Semiconductor stock rose 3.7% in May. For Advanced Micro Devices, Micron Technologies, NVIDIA, and Qualcomm, the stock prices fell ~0.8%, ~22.5%, ~25.2%, and ~22.4%, respectively, during the same period due to concerns about the US-China trade war.