SWKS: PMC Sierra terminates merger agreement

PR just issued:

WOBURN, Mass.–(BUSINESS WIRE)-- Skyworks Solutions, Inc. (NASDAQ: SWKS), an innovator of high performance analog semiconductors connecting people, places and things, today announced that it decided not to modify its amended and restated merger agreement with PMC-Sierra, Inc. (PMC®) (NASDAQ: PMCS), entered into on October 29, 2015. Today PMC terminated the amended and restated merger agreement and, as a result, Skyworks is entitled to an $88.5 million termination fee from PMC.

Skyworks maintains a highly disciplined approach to the assessment of potential acquisition candidates, and at an increased valuation, PMC no longer meets Skyworks’ financial criteria.

Skyworks’ upwardly revised mid-term target operating model remains unchanged from the annualized non-GAAP earnings per share of $8.00 it provided on its Q4 FY2015 earnings conference call on November 5, 2015.

That fee would amount to about 47 cents per share.

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That fee would amount to about 47 cents per share.

Wow - there’s got to be a profitable business opportunity going around making serial offers, getting trumped and then cashing in on termination fees…

Ant

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There were also legitimate costs for SWKS in the merger talks. Overall, I agree with their discipline to avoid a bidding war.

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