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TheStreet Open House

Avago Technologies To Acquire LSI Corporation For $6.6 Billion In Cash

Silver Lake Partners to Support Transaction With $1 Billion Investment in Avago

  • Positions Avago as a leader in enterprise storage
  • Expands market position and brings valuable system-level expertise in wired infrastructure
  • Diversifies revenue and scales up Avago across multiple attractive end markets
  • Significantly and immediately accretive to Avago free cash flow and EPS on a non-GAAP basis
  • $200 million of annual operating synergies expected by the end of fiscal year 2015

SAN JOSE, Calif. and SINGAPORE, Dec. 16, 2013 (GLOBE NEWSWIRE) -- Avago Technologies Limited (Nasdaq:AVGO) and LSI Corporation (Nasdaq:LSI) today announced that they have entered into a definitive agreement under which Avago will acquire LSI for $11.15 per share in an all-cash transaction valued at $6.6 billion. The acquisition creates a highly diversified semiconductor market leader with approximately $5 billion in annual revenues by adding enterprise storage to Avago's existing wired infrastructure, wireless and industrial businesses. The combined company will be strongly positioned to capitalize on the growing opportunities created by the rapid increases in data center IP and mobile data traffic. 

"This highly complementary and compelling acquisition positions Avago as a leader in the enterprise storage market and expands our offerings and capabilities in wired infrastructure, particularly system-level expertise," stated Hock Tan, President and Chief Executive Officer of Avago. "This combination will increase the Company's scale and diversify our revenue and customer base. In addition to these powerful strategic benefits, as we integrate LSI onto the Avago platform, we expect to drive LSI's operating margins toward Avago's current levels, creating significant additional value for stockholders."

"This transaction provides immediate value to our stockholders, and offers new growth opportunities for our employees to develop a wider range of leading-edge solutions for customers," said Abhi Talwalkar, President and Chief Executive Officer of LSI.  "Our leadership positions in enterprise storage and networking, in combination with Avago, create greater scale to further drive innovations into the datacenter."

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