Invest and buy in insecure times. The chip manufacturer Infineon is committed to both, and it’s coming to the US competitors Cypress. The stock market lowers the thumb, Infineon bags on Two and a half-year Low.
Nine billion euros, intends to spend Infineon’s rivals from California. The Dax group offers for Cypress Semiconductor 23,85 dollars per share in cash, such as Infineon announced on Monday in Munich. A corresponding contract was already signed. Infineon is the largest German chip manufacturer.
Through the acquisition of Cypress, Infineon strength is the focus on growth business fields, it was said to the statement: “We will offer our customers the most comprehensive Portfolio for the connection of the real with the digital world,” says Infineon in the message. The Americans produce, among others, a semiconductor to be used for future key technologies such as Autonomous Driving and industry 4.0. With the acquisition in the USA, Infineon is aiming to become number one in Chips for the automotive market.
Tail light in the Dax
Hardly the news was out, it was Infineon on Monday for the tail light in the Dax, the German share index. Investors in the offered price of nine billion euros was met mostly with oxygen. The bid is according to Infineon, a premium of 46 per cent on the recent average price of Cypress stock. “The purchase price is ambitious, in particular in relation to the current market uncertainty,” said Analyst Harald Schnitzer of the DZ Bank.
Focus on high-growth areas: Autonomous Driving and the Internet of things
However, the Management argued that the technology portfolios of both companies complemented each other. The open great potential in the high-growth target markets of Automotive, industrial and Internet of things (IoT). Infineon CEO Reinhard Ploss expects the positive sales effects are a result of the Takeover in the long term, with more than 1.5 billion euros per year. In addition, he sees potential savings of a year, 180 million euros.
For Infineon, it would be the biggest takeover attempt in the history of the 1999 Siemens outsourced company. The Acquisition is expected to be completed no later than the beginning of 2020, if shareholders and regulators give the green light. Currently, Infineon ranks in a global comparison, behind the U.S. companies such as Intel, Micron, Qualcomm and Broadcom, as well as behind the South Korean rival Samsung.
Recovery to wait for
The plans, however, in not easy times for the industry. Although market observers expect a recovery for the sector. However, we have to wait for. So Infinion CEO had a sales increase of eleven percent for this year, Ploss, in the last autumn in prospect. In February, the talk was then of nine per cent, in March, only five percent. Intel, industry giant from Silicon Valley, no longer seems so optimistic and expects to for the next few years with clearly single-digit growth rates.
Regardless of this, Infineon is driving the Expansion of high investment. According to media, the group intends to plug in this fiscal year to 1.5 billion euros in new factories and new machinery reports – with a turnover of 7.6 billion in the last year.
Multi-billion dollar Problem for the Chip industry
And then it is still Huawei the Problem. So far, Infineon is about a quarter of its products in China. One of the major customers, the Chinese technology giant, Huawei, was occupied by the U.S. government with a spell. The spell should also be taken, who else is doing business with Huawei. Through the Acquisition of the American competitor, the Cypress, the Munich want to strengthen the “focus on structural growth drivers”, such as the area of the Internet of things. At the same time, but, according to observers, is likely to reduce the business the company’s dependence on China.
ar/hb (rtr, dpa, afp – archive)