Texas Instruments to Buy National Semiconductor for $6.5 Billion

Texas Instruments Incorporated (TI) and National Semiconductor have signed a definitive agreement for TI to acquire National Semiconductor for $25 per share in an all-cash transaction of about $6.5 billion. The boards of directors of both companies have unanimously approved the transaction.

TI brings its breadth of 30,000 analog products, extensive customer reach and manufacturing, including its 300-millimeter analog factory. National brings a portfolio of 12,000 analog products, customers in the industrial power market and customer design tools.

Upon close of the transaction, National becomes part of TI’s analog segment, and sales of analog semiconductors will represent almost 50 percent of TI’s revenue.

The combined company also will benefit from National’s manufacturing operations, located in Maine, Scotland and Malaysia, which TI will continue to operate. Each site has additional capacity to increase production. National’s headquarters will remain in Santa Clara, California.

The acquisition is subject to customary closing conditions, including review by U.S. and international regulators and approval by National’s shareholders.  The transaction is expected to close in six to nine months.
 
The market for analog semiconductors was $42 billion in 2010. TI is the market leader with 2010 analog revenue of $6.0 billion, or 14 percent of the market. National’s revenue in calendar year 2010 was about $1.6 billion, or 3 percent of the market.