Marvell Technology Shares Gain on Asset Sale to NXP Semiconductors

Shares of Marvell Technology rise after a subsidiary of NXP Semiconductors agrees to purchase the company's WiFi and Bluetooth assets for $1.76 billion in cash.

Author:: M. Corey Goldman
Publish date:: May 29, 2019 9:43 AM EDT

Istock

Shares of Marvell Technology Group (MRVL) - Get Report gained on Wednesday after a subsidiary of NXP Semiconductors (NXPI) - Get Report announced that it has agreed to purchase the company's Wi-Fi and Bluetooth assets for $1.76 billion in cash.

Marvell shares rose 1.17% at $21.60 on the Nasdaq Stock Market. Shares of NXP, meanwhile, were down 2.1% at $87.72.

The deal is expected to close in the first quarter of 2020. Eindhoven, Netherlands-based NXP said it expects the assets, which generated about $300 million in revenue in Marvell's latest fiscal year, to double their associated revenue by 2022.

The acquisition is expected to be accretive to NXP'ss non-GAAP operating profit in the first full quarter after the transaction closes.

Separately, analysts at JPMorgan reiterated their overweight rating on Marvell's stock.