SWKS Skyworks Solutions Inc

Skyworks Solutions (SWKS) announced that it will acquire fabless semiconductor company SiGe Semiconductor for $210 million. Additionally, the company agreed to pay $65 million on achievement of certain milestones. The transaction is expected to close in June, 2011.

Headquartered in Andover, Massachusetts, SiGe Semiconductor is a provider of radio frequency (RF) front-end solutions facilitating wireless multimedia across a wide range of applications.

With the help of SiGe’s innovative short range, silicon-based products, Skyworks will expand its wireless networking product portfolio. Furthermore, the acquisition will enhance the company’s addressable content opportunity for smart phones, tablets, gaming consoles, notebook PCs and home automation systems.

The company expects to realize significant operational and cost synergies from the acquisition and a consequential growth in non-GAAP earnings as well as shareholders wealth.

Management expects an EPS of 46 cents in the third quarter of fiscal 2011, up from 41 cents in the second quarter of fiscal 2011, propelled by Skyworks’ broad customer base, diversification into new markets and increasing share gains.

Skyworks Solutions is capitalizing on proliferating demand for connection through smart phones, tablets and home automation systems. The company also consolidates its shares across the mobile Internet spectrum, ranging from net books and data cards to smartphones, and even entry level handsets. Moreover, Skyworks will gain from the rising tide of increasing RF content associated with the 3G and 4G Platforms.

Skyworks Solutions designs, manufactures, and markets a broad range of high performance analog and mixed signal semiconductors that enable wireless connectivity. The primary customers include Nokia (NOK), Motorola (MMI), Research In Motion (RIMM) and Samsung.

 
NOKIA CP-ADR A (NOK): Free Stock Analysis Report
 
RESEARCH IN MOT (RIMM): Free Stock Analysis Report
 
SKYWORKS SOLUTN (SWKS): Free Stock Analysis Report
 
Zacks Investment Research