NTDOY - Infineon's Planned Takeover of Cypress Semiconductor Is in Serious Trouble
Last June, German chipmaker Infineon (OTC: IFNNY) agreed to buy American chipmaker Cypress Semiconductor (NASDAQ: CY) for 9 billion euros ($10.3 billion). Cypress' stock, which previously traded in the mid-teens, surged toward Infineon's offer of $23.85 per share.
However, Cypress' stock recently gave up those gains after national security officials at the Committee on Foreign Investment in the U.S. (CFIUS) recommended that President Trump block the deal. According to Bloomberg, CFIUS voiced concerns about Infineon's dependence on China, which accounts for about a third of its revenue, and the sale of Cypress' chips to those Chinese customers.
Cypress sells chips to defense companies, including "defense grade memory" that can withstand "military operating temperature ranges." However, these chips don't include any sensitive technologies that aren't offered by other chipmakers.