Tessera To Acquire DTS In All-cash Deal Valued At $850 Million

By Ciara LinnaneMarketsMarketWatch Pulse

Tessera Technologies Inc. said Tuesday it has agreed to acquire DTS Inc. in an all-cash deal valued at about $850 million. The deal will create an audio and imaging company with more than 450 engineers to develop, next-generation imaging, audio and semiconductor package technology, the companies said in a statement. The deal is expected to immediately boost Tessera's per-share earnings and free cash flow and to generate pro forma 2016 revenue of abut $450 million. Tessera will pay $42.50 per DTS share, equal to a 28% premium on DTS' 30-day volume weighted average price as of Sept. 19. The deal is expected to close late in the fourth quarter or early in 2017. DTS shares were halted premarket, while Tessera shares were not yet active. Tessera shares have gained 12% in the year to date, while the S&P 500 has gained 4.7%.

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