Mobile chipmaker Qualcomm has agreed to acquire Cambridge, U.K.-based CSR for £1.56 billion (~$2.5 billion). The latter rejected an earlier offer from Microchip Technology back in August, but the FT notes that Microchip now has until 5pm today U.K. time to put in an increased offer to challenge Qualcomm’s all-cash bid.
CSR, which was formerly known as Cambridge Silicon Radio, sold its mobile division to Samsung for $310 million back in July 2012. But Qualcomm’s interest here lies in the other areas for which the company designs chips as it looks to expand its capabilities beyond mobile, to build chips that power all manner of connected devices as the Internet of Things spins up. CSR has particular expertise with audio and Bluetooth chip designs, including the low-energy flavor of Bluetooth which is increasingly being used to power connected devices.
In a statement announcing the acquisition, Qualcomm CEO Steve Mollenkopf said: “The addition of CSR’s technology leadership in Bluetooth, Bluetooth Smart and audio processing will strengthen Qualcomm’s position in providing critical solutions that drive the rapid growth of the Internet of Everything, including business areas such as portable audio, automotive and wearable devices.
“Combining CSR’s highly advanced offering of connectivity technologies with a strong track record of success in these areas will unlock new opportunities for growth. We look forward to working with the innovative CSR team globally and further strengthening our technology presence in Cambridge and the UK.”
Qualcomm’s press release on the acquisition adds:
The acquisition complements Qualcomm’s current offerings by adding products, channels, and customers in the important growth categories of Internet of Everything (IoE) and automotive infotainment, accelerating Qualcomm’s presence and path to leadership. This opportunity is aligned with Qualcomm’s established strategic priorities in these rapidly growing business areas.
Qualcomm’s offer values the FTSE 250 listed company at 900p per share. CSR shares are currently trading around the 860p mark.
The transaction is subject to regulatory approval and the approval of CSR’s shareholders. If all closing conditions are met it is expected to close by the end of the summer of 2015. Qualcomm said it expects the acquisition to be accretive to Non-GAAP earnings per share in fiscal 2016, the first full year of combined operations.
Back in 2012, Samsung also purchased a 4.9 percent stake of the main CSR company itself, for $35 million, so there’s presumably a multimillion dollar windfall heading its way if the Qualcomm takeover goes through.