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Analog Devices takes over Linear Technology for $14.8 billion

Analog Devices on Tuesday announced its decision to acquire the Linear Technology Corporation cash and stock transaction for $14.8 billion. According to the agreement, Analog Devices will buy Linear Technology for approximately $60.00 per share.

The combined valuation of the companies after acquisition would be around $30 billion, Analog Devices said in a press release. The companies, which manufacture power management chips, would be named Analog Devices, Inc. after the acquisition.

Analog Devices has planned to give 58 million new shares of Analog Devices common stock, amounting to approximately $7.3 billion of the buyout amount. The rest would be paid in company’s balance sheet cash.

“The combination of Analog Devices and Linear Technology brings together two of the strongest business and technology franchises in the semiconductor industry,” President and Chief Executive Officer of Analog Devices, Inc. Vincent Roche said.

“We have tremendous respect and admiration for the franchise created by Linear Technology. I have no doubt that the combination of our two companies will create a trusted leader in our industry, capable of generating tremendous value for all of our stakeholders,” he said.

Linear Technology shareholders will receive $46.00 per share in cash and own about 16 percent of the combined company after the transaction closes, which is expected to happen by the end of the first half of 2017.

“This combination of Linear Technology and Analog Devices has the potential to create a combination where one plus one truly exceeds two. As a result, the Linear Technology Board concluded that this is a compelling transaction that delivers substantial value to our shareholders, and the opportunity for additional upside through stock in the combined company,” Executive Chairman and Co-founder of Linear Technology Bob Swanson said.

“Together, Linear Technology and Analog Devices will advance the technology and deliver innovative analog solutions to our customers worldwide. We are committed to working with the ADI team to ensure a smooth transition,” Swanson said.

Roche would serve as President and CEO of Analog Devices, Inc. The teams in different areas of the combined firm would include employees from both Analog Devices and Linear Technology.

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