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Infineon Tech To Buy Cypress Semiconductors For $23.85/shr In Cash

Infineon Technologies AG (IFNNY) said that it agreed to buy Cypress Semiconductors Corp. (CY) for $23.85 per share in cash, representing an enterprise value of 9.0 billion euros.

The offer price represents a 46 percent premium to Cypress' unaffected 30-day volume-weighted average price during the period from 15 April to 28 May 2019.

Infineon expects to close the Cypress acquisition by the end of calendar year 2019 or early 2020. It expects to benefit from earnings accretion beginning in the first full fiscal year after closing of the deal.

Infineon has validated sales and cost synergies assumptions as part of due diligence. Expected economies of scale will create cost synergies of 180 million euros per annum by 2022. The complementary portfolios will enable the offering of further chip solutions with a revenue synergies potential of more than 1.5 billion euros per annum in the long term.

Infineon said it will adapt its target operating model following successful integration. The company targets through-cycle revenue growth of 9+ percent and a segment result margin of 19 percent. The investment-to-sales ratio is targeted to decrease to 13 percent.

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