Skyworks trumps Microsemi with $2.27 billion bid for PMC-Sierra

(Reuters) - Chipmaker Skyworks Solutions Inc raised its offer to buy PMC-Sierra Inc to about $2.27 billion, trumping a rival bid worth $2.25 billion from Microsemi Corp .Skyworks raised its offer to $11.60 per PMC-Sierra share from $10.50 per share. Microsemi's offer is worth $11.50.PMC-Sierra's shares rose 3.3 percent to $12.02 in premarket trading on Friday. Skyworks' shares were up about 1.1 percent and Microsemi was untraded.The boards of both Skyworks and PMC-Sierra have approved the amended merger agreement, the companies said in a joint statement.Apple supplier Skyworks offered to buy PMC-Sierra for $2 billion in cash in earlier this month, aiming to boost its portfolio, customer base and end market applications.Microsemi makes chip equipment and provides software for cloud data and has been trying to build up its communications business when an explosion of data from mobile devices has greatly boosted the need for efficient storage hubs.The new deal between Skyworks and PMC-Sierra includes a termination fee of $88.5 million, higher than the $70.0 million agreed on in the first offer, the companies said.Skyworks said it intends to fund the acquisition with cash on hand from the combined company and with fully committed debt financing.Up to Thursday's close PMC-Sierra's shares had jumped more than 51 percent since Oct. 5, when Skyworks made its first proposal. Skyworks shares have fallen about 9 percent in that period.(Reporting by Arathy S Nair in Bengaluru; Editing by Savio D'Souza)Join the conversation about this story
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