MediaTek pursues PMIC market with Richtek buy

MediaTek pursues PMIC market with Richtek buy

Business news |
By eeNews Europe

MediaTek said that the acquisition would give it a leadership position in power management ICs and help it broaden its offerings for use in the Internet of Things.

Initially MediaTek plans to acquire between approximately 35 and 51 percent of the outstanding stock in Richtek paying NT$195 per share. This will cost MediaTek between about $310 million and $450 million. Upon completion of the tender offer, MediaTek plans to acquire 100 percent of Richtek’s outstanding shares and complete the acquisition in the second quarter of 2016, subject to relevant regulatory approvals.

Richtek, founded in 1998, is traded on the Taiwan Stock Exchange. In the first half of 2015 the company made a profit of NT$742 million (about $23 million) on sales revenue of NT$6,292 million (about $191 million).

MediaTek has been growing rapidly on its penetration into smartphone equipment and through the acquisition of MStar, another Taiwanese chip company.

"As a global leader with significant presence in smartphones, tablets, and the digital home, MediaTek offers tremendous growth opportunities for power management related products through the cross-platform advantage,” said Ming-Kai Tsai, chairman and CEO of MediaTek in a statement. He added that the acquisition would also strengthen MediaTek’s positioning in the Internet of Things.

In the same statement Kenneth Tai, chairman of Richtek spoke in favor of the acquisition saing it would enable the use of MediaTek’s platoforms for optimization of power management performance at the system level.

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