Renesas is Acquiring Australia’s Altium Software Company for $5.9B

Renesas Electronics, a Japan-based chip manufacturer, announced it would buy Australia’s software designing company, Altium, for $5.9 billion or 9.1 billion in Australian dollars. Based on the reports, the firm is paying for the acquisition in all cash.

According to The Wall Street Journal, Renesas Electronics plans to finance its purchase of Altium for A$68.50 per share through cash on hand and bank loans. Both firms said this acquisition will help bring about an integrated and open electronics system design and lifecycle management program.

Arrangement for the Acquisition

The transaction between Renesas and Altium comes just a month after the former agreed to purchase Transphorm power electronics company based in California. The semiconductor firm bought it for $5.10 per share, another all-cash deal worth $339 million.

In any case, the acquisition is set to be fulfilled by way of a Scheme of Arrangement (SOA) that will be under the power of the Australian Corporations Act. This is said to be a means of acquiring 100% of the outstanding shares of an Australian-listed business. Renesas and Altium have signed a Scheme Implementation Agreement (SIA), which the companies’ respective boards of directors unanimously approved.

Expected Completion of Buyout Deal

The Japanese chipmaker said it is looking to close the acquisition of Altium within the latter half of this year. Renesas noted that this deal is still subject to the approval of Altium’s shareholders and the Australian court. For the last stages of the transaction, regulatory approvals are also needed on top of compliance with other customary closing conditions.

“The acquisition brings together Altium’s sophisticated cloud platform capabilities with Renesas’ strong portfolio of embedded solutions, combining high-performance processors, analog, power and connectivity,” Renesas said in a press release. “The combination will also enable integration with third-party vendors across the ecosystem to execute all electronic design steps seamlessly on the cloud.”

The company further said the deal will fortify its financial profile and give shareholders notable value by strengthening its digitalization strategy. Renesas added that “the transaction is immediately accretive to earnings without synergies; the combined company expects to achieve earnings impact from revenue and cost synergies after the completion of the transaction.”

Photo by: Renesas Newsroom