Qualcomm reached an agreement to buy Cambridge wireless technology developer CSR plc for £9 per share valuing the firm at £1.6bn ($2.5bn).
Qualcomm said the acquisition adds products, channels, and customers in the important growth categories of Internet of Everything (IoE) and automotive infotainment, accelerating Qualcomm’s presence and path to leadership. This opportunity is aligned with Qualcomm’s established strategic priorities in these rapidly growing business areas.
At £9.00 per share, the acquisition of the entire issued and to be issued ordinary share capital of CSR is valued at approximately £1.6 billion ($2.5 billion based upon an exchange rate of USD:GBP 1.6057). This cash offer has been unanimously recommended by the CSR board of directors.
George O’Connor, technology market analyst at Panmure, said: "A good deal for CSR, which has been mooted as being ‘in play’ for a while. With the Microchip warning earlier this week battering share prices this side of the pond Qualcomm looks a bit of a smartie pants taking advantage of weak market conditions. Hat tip to them. That said as we look through the results from the NEM (network equipment manufacturers), the semis, and the service providers this does not look like a great time operationally. For this reason some Qualcomm investors are likely to take a cynicaly ‘show me the money’ view that when all is not well – Qualcomm has taken a distract the masses with a deal-type view."
The acquisition is subject to a number of conditions as set forth in the announcement released today in accordance with Rule 2.7 of the UK Takeover Code, including the receipt of U.S. and other regulatory approvals and the approval of CSR’s shareholders. Subject to the satisfaction of the conditions, the transaction is expected to close by the end of the summer of 2015. Qualcomm expects the acquisition to be accretive to Non-GAAP earnings per share in fiscal 2016, the first full year of combined operations.
"The addition of CSR’s technology leadership in Bluetooth, Bluetooth Smart1 and audio processing will strengthen Qualcomm’s position in providing critical solutions that drive the rapid growth of the Internet of Everything, including business areas such as portable audio, automotive and wearable devices," said Steve Mollenkopf, chief executive officer of Qualcomm Incorporated.
"Combining CSR’s highly advanced offering of connectivity technologies with a strong track record of success in these areas will unlock new opportunities for growth. We look forward to working with the innovative CSR team globally and further strengthening our technology presence in Cambridge and the UK."