NXP Semi's Stock Surges After $47 Billion Buyout Deal With Qualcomm

By Tomi KilgoreMarketsMarketWatch Pulse

Shares of NXP Semiconductors N.V. surged 3.1% in premarket trade Thursday, after the chip maker announced an agreement to be acquired by Qualcomm Inc. in a deal that would value NXP at about $38 billion. Qualcomm's stock gained 2.1% ahead of the open. Under terms of the agreement, Qualcomm will pay $110 a share in cash for each NXP share outstanding, which represents an 11% premium to Wednesday's closing price of $98.66. The total value of the deal, including debt, would be about $47 billion, the companies said. Qualcomm expects the deal to "significantly" add to adjusted earnings immediately after it closes, with synergies of $500 million a year. "The NXP acquisition accelerates our strategy to extend our leading mobile technology into robust new opportunities, where we will be well positioned to lead by delivering integrated semiconductor solutions at scale," Qualcomm Chief Executive Steve Mollenkopf said. The Wall Street Journal had reported in late September that it NXP was in buyout talks with Qualcomm. NXP's stock has rallied 17% year to date through Wednesday, while Qualcomm shares have soared 36%, the PHLX Semiconductor index has surged 25% and the S&P 500 has gained 4.7%.

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