Dialog Semiconductor Plc, has entered into an agreement to acquire iWatt Inc., a leading provider of digital power management integrated circuits (ICs), for a cash payment of approximately $310 million, plus an additional $35 million contingent on iWatt achieving future revenue targets.
Both companies’ boards of directors have approved the acquisition, with the transaction to be completed by the end of July. In 2012, Dialog had $774 million in revenue and employs some 850 hi-tech workers. The acquisition is being funded from both Dialog's existing cash resources and additional debt facilities of $125 million.
“We see the acquisition enabling Dialog to address adjacent emerging power management segments, including cutting-edge AC/DC solutions for next generation fast portable chargers as well as ICs for LED solid state lighting,” said Dialog's CEO Jalal Bagherli.
“iWatt is expected to increase our future business opportunities with market leading customers such as Samsung, HTC and Nokia in the portable segment, and GE, Osram and Philips in the fast growing solid state lighting market,” he added.
The acquisition enhances Dialog’s power management offerings for tablets and smartphones by adding iWatt's complementary AC/DC digital power management technology. iWatt also brings with it two high-growth product families: AC/DC charger adaptor ICs and a broad range of LED Solid State Lighting (SSL) chips. The transaction adds a portfolio of more than 110 patents.
iWatt is expected to expand Dialog's opportunities in the adjacent digital power management space, unlocking new growth opportunities. The company’s total available market (TAM) is expected to increase by a potential $1.8 billion to $5.9 billion by 2015, according to Dialog.
iWatt has approximately 180 employees worldwide, including a design and application engineering presence in Asia. Its PrimAccurate technology platform addresses AC/DC power conversion and LED SSL markets. The company said it has shipped more than one billion power management ICs since 2007.
Dialog is headquartered near Stuttgart, Germany and registered in the United Kingdom. iWatt is headquartered in Campbell, California.