Market Insight

Consolidation continues as Skyworks Acquires PMC Sierra

October 06, 2015  | Subscribers Only

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Skyworks announced Monday the intent to acquire PMC Sierra for $2 billion in cash. The acquisition will give Skyworks an expanded customer base and additional addressable markets, including expanded capabilities focusing on end to end connectivity, networking infrastructure, and data center applications. Company management expects that post-merger they will have more than $4 billion in annual revenue and the transaction is anticipated to be immediately accretive to non-GAAP earnings upon close. The deal is also expected to create cost synergies of $75 million within 12 months, and at Q2-2015 revenue levels of the two separate entities would move Skyworks up the semiconductor supplier rankings two spots as the 21st largest semiconductor vendor by revenue according to the IHS’ Competitive Landscaping Tool.  Which companies might Skyworks overtake and while the application markets mentioned above are areas of focus for Skyworks to address with this acquisition how competitive will it be in these areas initially?

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