ADI and Maxim to Merge in Deal Worth $21 billion

To quote The King, I’m all shook up.

Fresh off Analog Devices’ acquisition of Linear Technology a scant three years ago, the Massachusetts-based semiconductor giant has announced a merger with Maxim.

And just when you thought 2020 was fresh outta surprises…

The deal ran approximately $21 billion (for a combined enterprise worth about $68 billion), and according to ADI, Maxim stockholders will receive 0.630 of a share of ADI common stock for each share of Maxim common stock they hold at closing.

Meanwhile, ADI stockholders will own 69% of the new company, while Maxim stockholders will hold a 31% stake.

The significance of this pact cannot be overstated – by one estimate, ADI and Maxim are the 5^th- and 8^th-biggest semiconductor companies in the U.S. (according to market capitalization), and this merger creates a true juggernaut.

“Maxim is a respected signal processing and power management franchise with a proven technology portfolio and impressive history of empowering design innovation,” said Vincent Roche, President and CEO of ADI. “Together, we are well-positioned to deliver the next wave of semiconductor growth, while engineering a healthier, safer and more sustainable future for all.”

More importantly, ADI and Maxim were rivals, as my European Colleague, Ally Winning, pointed out, so the merger strengthens their common portfolio.

24/7 Wall St. ponders whether the combined enterprise can take on Texas Instruments – the deal certainly narrows the gap between ADI and TI.

The deal should close by next summer, and PSD will provide updates as they come in.