Infineon Technologies AG announced the closing of the acquisition of Cypress Semiconductor Corporation. The San Jose-based company has become part of Infineon effective as of the Closing.
The addition of Cypress lets Infineon further strengthen its focus on structural growth drivers and on a broader range of applications. This will accelerate the company’s path of profitable growth. Cypress adds a differentiated portfolio of microcontrollers, connectivity components, software ecosystems, and high-performance memories. All this is highly complementary to Infineon’s leading power semiconductors, automotive microcontrollers, sensors, and security solutions. Combining these technology assets enables advanced solutions for high-growth applications such as ADAS/AD, IoT and 5G mobile infrastructure. The addition of Cypress’s strong R&D capabilities and its foothold in the U.S. and Japan strengthen Infineon’s connections with customers around the world.
On 3 June 2019, Infineon and Cypress announced that the companies had signed a definitive agreement under which Infineon would acquire Cypress for US$23.85 per share in cash, corresponding to an enterprise value of €9.0 billion. The transaction has been approved by the Cypress shareholders and all required regulatory clearances have been obtained.
The acquisition is expected to be accretive to earnings in the 2021 fiscal year. The profitability is expected to rise while the capital intensity of the combined business will decrease, increasing free cash flow. We expect annual cost synergies of €180 million gradually ramping up over approximately three years after Closing. The complementary portfolios will enable the offering of additional chip solutions with a revenue synergy potential of more than €1.5 billion per annum in the long term.