Why Silicon Image Is Having A Big Day

Shares of Silicon Image, Inc. SIMG soared over 20 percent Tuesday following an announcement that Lattice Semiconductor Corporation LSCC will acquire the company for $7.30 per share, or approximately $600 million.

The joint-press release cited key benefits of the deal, including increased strategic relevance benefitting customers, revenue expansion opportunities, a stronger IP portfolio and economies of scale.

At least $32 million in annual synergies which are expected within one year and the transaction is expected to be immediately accretive on a non-GAAP basis, according to the press release.

Darin G. Billerbeck, Lattice Semiconductor’s President and Chief Executive Officer, said: “This is a truly transformative event for both Lattice Semiconductor and Silicon Image. For the first time in the semiconductor industry, a single company will combine the design flexibility and time to market benefits of FPGAs, with the highly integrated, function and cost optimization benefits of ASSP solutions.”

Shares of Lattice Semiconductor LSCC also benefitted from the news and recently traded at $7.19, up 9.10 percent.

On January 9, reports surfaced that Silicon Image, Inc. was exploring a sale which promted the shares to rise temporarily above the $6.00 level.

The stock recently traded at $7.29, up 23.56 percent.

Posted In: Long IdeasNewsM&ATrading Ideas
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