Dialog Semiconductor to Acquire SiTel

Power management semiconductor maker Dialog Semiconductor plc has completed a transaction to acquire SiTel Semiconductor B.V., a provider of short-range wireless, digital cordless and VoIP technology.

Wireless connectivity in personal portable devices is becoming increasingly prevalent within our society. As this trend continues, the market for proprietary and standards-based low power wireless ICs represents one of the highest growth opportunities in the semiconductor market today, with total units predicted by IMS Research to reach more than 4 billion by 2015, representing a CAGR of 32.2% between 2010 and 2015.

Under the terms of the transaction, Dialog paid an enterprise value of $86.5 million. The transaction is expected to be accretive to both cash and IFRS EPS from Q3 2011. The acquisition has been funded using Dialog’s existing cash reserves.

In financial year 2010 SiTel generated unaudited revenues of approximately $116.9 million (2009: $109.6 million) with a 42.4% gross margin. SiTel’s customers include Gigaset, Panasonic, Microsoft, Plantronics and LG Ericsson: each world-leading brand names in their respective market segments for portable personal consumer devices and VoIP connectivity. SiTel was previously a portfolio company of UK-based private equity firm HgCapital.

Dialog Semiconductor