Microsemi Corporation (NASDAQ:MSCC) Surges Higher on Chip Deal Frenzy


A Bloomberg report lit a fire under the Microsemi Corporation (NASDAQ:MSCC) stock Thursday, claiming that the latter had received takeover interest from Skyworks Solutions Inc.

Microsemi shares leaped 14.73% higher, closing at $47.99 on volume of 9.68 million shares.

The news was enough to catapult Microsemi out of a rising channel it was moving inside of since 2009, raising the prospect of solid gains for investors if a buyout deal materializes at a premium.

Microsemi makes specialized chips that can function in extreme environments for customers in defense, telecom and aerospace industries.

Microsemi Corporation (NASDAQ:MSCC) may be in play courtesy Skyworks

A Bloomberg report published after hours Wednesday said chipmaker Microsemi appointed Bank of Montreal to scour the market for better offers after it received a buyout offer from Skyworks Solutions Inc.

The sale process is reportedly being run with another financial adviser also in the picture.

If, however, the deal does go through, Skyworks will have the last laugh because it had previously lost to Microsemi in a bidding war to gain control of PMC-Sierra.

The chip industry has seen a rash of deal-making in recent days. On Wednesday, chipmaker Broadcom announced a deal to acquire Brocade Communications Systems for $5.9 billion. On Oct. 27, Qualcomm said it will buy NXP Semiconductors for $39 billion to create the second largest chipmaker by revenue after Intel.

[See our companion article today on the acquisition of Lattice Semiconductor by a Chinese-backed private equity firm.]

Microsemi Corporation (NASDAQ:MSCC) launches new product

Also helping to fan bullishness in its stock was the launch by Microsemi of new Ethernet PHYs for industrial and internet of things (IoT) applications.

“These new single-port SimpliPHY GbE and FE PHYs further underscore our commitment to bring cost effective, differentiated Ethernet solutions to Microsemi’s key focus markets, including industrial, IoT, enterprise and carrier/telecommunications,” said Uday Mudoi, vice president, marketing, for Microsemi’s Ethernet Networking Technology (ENT) group. “These new devices, combined with open-source licensed Linux Driver Software and comprehensive design collateral, enable quick time to market for our customers and ecosystem partners.”


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