- MaxLinear is to acquire Silicon Motion in a cash and stock transaction valuing the latter at $3.8 billion.
- As per the analysis, the deal represents synergistic growth across the compute, networking, and storage areas.
- More importantly, there should be cost synergies that come with scale together with volume orders of chips from foundries, and MaxLinear has the ability to also leverage Silicon's lower staff cost.
- On the other hand, there are risks of regulatory delays which can induce volatility in the share prices.
- Taking into consideration lower valuations, I consider that only the acquisition target is a buy, but wait for the market to stabilize before investing.
For further details see:
Making Sense Of MaxLinear's Bid For Silicon Motion