Analog Devices to buy rival Maxim Integrated, form $68B chipmaker

Deal pays 0.63 Analog shares for each Maxim share owned

Chipmaker Analog Devices Inc. has agreed to buy rival Maxim Integrated Products Inc. in a $20.91 billion all-stock deal.

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The transaction forms a $68 billion chipmaker and pays Maxim shareholders 0.63 shares of Analog stock for each Maxim share they own. Analog shareholders will own about 69 percent of the combined company while Maxim shareholders will own approximately 31 percent.

"Maxim is a respected signal processing and power management franchise with a proven technology portfolio and impressive history of empowering design innovation,” Analog CEO Vincent Roche said in a statement. “Together, we are well-positioned to deliver the next wave of semiconductor growth, while engineering a healthier, safer and more sustainable future for all.”

TickerSecurityLastChangeChange %
ADIANALOG DEVICES INC.113.48+0.80+0.71%
MXIMMAXIM INTEGRATED PRODUCTS INC.65.53+0.57+0.88%

The deal, which is expected to close in the summer of 2021, will increase ADI's revenue by $8.2 billion and free cash flow by $2.7 billion on a pro forma basis.

The transaction is expected to be accretive to ADI's adjusted earnings per share in 18 months and produce $275 million of cost synergies by the end of year two. Further synergies are expected to be realized by the end of year three.

Morgan Stanley served as lead adviser for ADI while Bank of America was the financial adviser. Maxim used JPMorgan exclusively.