Microsemi acquires Zarlink Semiconductor, broadens revenue stream

According to Microsemi, the deal will enable the company to strengthen its medical technology product range. The agreement ends a long running standoff between the two companies. Microsemi first approached Zarlink, which designs mixed signal chip technology, in January 2011, but the initial offer was rejected. It was only when Microsemi increased the bid by 19% that Zarlink accepted the offer, despite having been in discussions with at least 15 other interested companies. Almost 40% of Microsemi's current revenue is generated from the defence sector, and the acquisition is seen as a way to diversify into medical device technology. James Peterson, Microsemi's chief executive, said: "Entering the process and performing diligence enabled us to confirm the compelling strategic fit between the two companies. Furthermore, Zarlink's fundamentals, technology capabilities, product roadmap and revenue growth opportunities exceeded our expectations. By bringing Microsemi's scale and discipline to this tremendous property, we expect to deliver outstanding results for our shareholders."