Semiconductor supplier Semtech will acquire Canada’s Sierra Wireless, Internet of Things (IoT) solutions provider, in a deal valued at $1.2 billion.
Semtech will acquire all shares of Sierra Wireless for $31 per share in an all-cash deal.
The acquisition will significantly expand Semtech’s addressable market and is expected to approximately double Semtech’s annual revenue and create a strong and diverse portfolio of connectivity solutions for the growing IoT market.
This acquisition brings together two important technologies for the future of IoT – LoRa and cellular – to enable the digitization of the industrial world with a comprehensive chip-to-Cloud platform.
“We believe the next era of technology growth is the digitization of our industrial world – the Internet of Everything,” said Semtech president and chief executive officer, Mohan Maheswaran.
The deal is also expected to be immediately accretive to Semtech’s non-GAAP EPS before synergies and generate US$40 million of run-rate operational synergies within 12-18 months post-transaction close.
Sierra Wireless said preliminary revenues are expected to be between $185 million and $189 million for the second quarter of 2022. Adjusted EBITDA is expected to be between $21 million and $23 million, as compared to first quarter 2022 adjusted EBITDA of $15.8 million.
Semtech is a global supplier of analog and mixed-signal semiconductors and advanced algorithms for infrastructure, high-end consumer and industrial equipment.