LSI, best known on Myce as the developer of the Sandforce SSD controllers, today announced it's been acquired by Avago Technologies. The latter is a designer and developer of analog semiconductors and was once part of HP. The company will acquire LSI for $11.15 per share in an all-cash transaction valued at $6.6 billion.
The basic financial layout is explained from the following excerpt of LSI’s statement, "LSI’s stockholders will receive $11.15 in cash for each share of LSI common stock they hold at closing, $4.6 billion term loan from a group of banks; and a$1 billion investment from Silver Lake Partners, which is expected to be in the form of a seven year 2% convertible note with a conversion price of $48.04 per share or preferred stock with equivalent economic terms."
With the acquisition Avago hopes to create a highly diversified semiconductor market leader by adding enterprise storage to Avago's existing wired infrastructure, wireless and industrial businesses. The combined company will be strongly positioned to capitalize on the growing opportunities created by the rapid increases in data center IP and mobile data traffic.
Article co-authored with Geir Dahl
