IFNNY - Why Cypress Semiconductor Stock Plunged Today
Shares of Cypress Semiconductor Corporation (NASDAQ: CY) plunged today, down by 14% as of 11:30 a.m. EST, on a report that the government may seek to block Infineon's (OTC: IFNNY) acquisition of the company. Last summer, Infineon announced a deal to buy the smaller chipmaker for $23.85 per share in cash.
National security officials are calling for President Trump to block the proposed transaction, according to Bloomberg. The concern is that the acquisition presents national security risks due to Infineon's business interests in China, which represents approximately a third of revenue. Infineon estimates that the Cypress acquisition can yield 180 million euros ($204 million) in annual cost synergies by 2022 and 1.5 billion euros ($1.7 billion) in revenue synergies longer term.
Image source: Infineon.