Freescale Semiconductor agreed to a takeover by private-equity firms led by Blackstone Group for $17.6 billion in the biggest technology buyout ever.
Shareholders will be offered $40 a share in cash, a 36 percent premium over Austin-based Freescale’s average closing price.
Blackstone led a group that included Fort Worth-based Texas Pacific Group, Washington-based Carlyle Group and London-based Permira Advisers that topped a rival bid by a consortium headed by Kohlberg Kravis Roberts at the 11th hour. Freescale said it will be able to solicit proposals from other bidders for 50 days.
Private equity firms and management have announced a record $358 billion worth of acquisitions this year, surpassing last year’s total of $275 billion, according to Bloomberg data, driven by record fund raising and cheap financing. The Freescale buyout will beat the $11.3 billion that private equity firms paid last year for software maker SunGard Data Systems.
Freescale is among the Worldwide Top 20 Semiconductor Sales Leaders. Motorola announced the spinoff of the company on October 6, 2003. Freescale completed its IPO on July 16, 2004 and is now trading on NYSE under the symbol FSL.
Freescale says they have made more than 17 billion semiconductors, embedded in automobiles, computer networks, communications infrastructure, office buildings, factories, industrial equipment, tools, mobile phones, home appliances and consumer products.
UltraWideBand, Zigbee, 802.11n and WiMAX could be growth areas for Freescale.
The IEEE 802.15.3a working group, which hoped to unite UWB factions, finally threw in the towel and disbanded. The IEEE gave up on uniting the two incompatible UWB camps. In the end there was no consensus between the Motorola/Freescale backed Direct-Sequence UWB group and the Intel-led WiMedia Alliance (and its new cousin: EWC). Whether 802.11n will make both flavors of UWB a marginal competitor compared to the high speed local area networking of “N” remains to be seen.
All U.S. cars, SUVs and other vehicles will be required to have anti-rollover technology by the 2012 model year, increasing the need for sensor motes and similar embedded devices.
Motorola recently announced an initiative to develop its own mobile WiMAX chipsets, observes Caroline Gabriel of Rethink Research. Freescale, which recently stepped up its own WiMAX activities, might be one option for Motorola.
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