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Littelfuse Buys IXYS for $750 Million

Littelfuse, a major supplier of circuit protection devices, paid $750 million for IXYS, a power chipmaker focused on medium and high power control devices for industrial, communications, and medical applications.

Littelfuse said that the deal, announced on Monday, would bolster its sales of power electronics for electric cars and factory equipment. The deal also gives Littelfuse expertise in silicon carbide semiconductors, which handle higher voltages and switching speeds that normal silicon.

The move dovetails with its acquisition of TE Connectivity’s circuit protection business, which closed last year for $350 million. In March, Littelfuse invested $15 million in Monolith Semiconductor, a start-up that sells power diodes based on silicon carbide – also known as SiC – for electric vehicles and renewable energy applications.

Littelfuse estimates that it will generate around $1.5 billion in annual revenue and save $60 million in the first two years following the deal. IXYS, headquartered in Milpitas, Calif., and Leiden, Netherlands, reported revenues of $322 million in its last fiscal year with margins around 13.5%.

The deal comes after two years of frantic mating in the semiconductor industry, which has faced pricing pressure and rising development costs. But corporate matchmaking has slowed in recent months, with a few exceptions. In March, MaxLinear acquired Exar Corporation for $700 million, expanding into interface and power management chips.

Semiconductor deals totaled $1.4 billion in the first half this year, according to IC Insights, a research firm based in Scottsdale, Ariz. But last year, chipmakers paid out almost $100 billion on semiconductor deals, down slightly from $107.3 billion in 2015, IC Insights said in a recent report.

Littelfuse said that it plans to seal the deal in the first quarter of 2018. Once the deal is closed, Nathan Zommer, IXYS’s founder and largest stockholder, is expected to sit on Littelfuse’s board.

TAGS: Analog
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