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Fairchild, Power Integration & Semtech In Play On Rumor Of Infineon Chip Acquisition

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Update: Reuters Reports Infineon Will Not Acquire Fairchild or Freescale.

Fairchild Semiconductor (NASDAQ: FCS) shares are trading higher Wednesday after Bloomberg reported Infineon (OTC: IFNNY) is in talks to acquire a chip company.

Although the takeover target was not named, the deal is reportedly worth $2 billion.

With a $1.9 billion market capitalization, Fairchild’s equity matches the profile.

$468 million of debt would push its enterprise value far beyond $2 billion, but reports sometimes only include the value of equity. Wall Street thinks the deal is is a possibility, as suggested by Wednesday morning's trading activity. Shares were last trading 5.7 percent higher to $16.90.

Bloomberg also suggests Power Integrations (NASDAQ: POWI) and Semtech (NASDAQ: SMTC) are other acquisition possibilities. Market caps are $1.7 billion and $1.6 billion, respectively. Enterprise values of both companies are below $2 billion. However, shares of Power Integrations and Semtech are yet to trade hands.

Infineon declined to comment on the rumor to Benzinga, but said the company has been looking for takeover targets for an extended period of time.

Posted-In: BloombergNews M&A Trading Ideas

 

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