Conexant Systems agrees to be acquired by SMSC in $284 million deal

By Jennifer Lanning Drey

Savannah, Ga., Jan. 10 - SMSC and Conexant Systems, Inc. have entered into a definitive agreement under which SMSC will use cash and stock to purchase all of the outstanding shares of Conexant, Hauppauge, N.Y.-based SMSC announced Monday.

The transaction is valued at $284 million, which includes the assumption of Conexant's net debt, Christine King, SMSC's chief executive officer, said during a company conference call held Monday.

The total cash consideration to be paid in the transaction is $98 million.

The transition is expected to close in the first half of calendar 2011 and is subject to regulatory requirements, approval by Conexant stockholders and other customary closing conditions, she said.

"We are very excited about the strategic technology engineering and financial implications of our future together," King said.

"This creates a company which is balanced and diversified in terms of end market presence and geographical reach," she later added.

SMSC expects to realize $8 million to $10 million in annualized pre-tax cost synergies by the end of the fourth quarter of fiscal 2012.

Conexant is a fabless semiconductor company based in Newport Beach, Calif.

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