NEW YORK (The Deal) -- Radio frequency components maker RF Micro Devices (RFMD) of Greensboro, N.C., said Monday that it agreed to acquire industry counterpart TriQuint Semiconductor (TQNT) in a tax free, all-stock merger valued at about $1.5 billion.
Terms of the deal call for TriQuint shareholders to receive 1.675 shares of the new combined company for each TriQuint share they own. RF Micro shareholders will get 1 share of the new combined company for each RF Micro share they own. After closing, shareholders from both sides will own 50% of the new combined company. The company's new board will be made up five members of each side's existing board.
The merger values TriQuint at $9.73 per share, representing a 5.4% premium over its Feb. 21 closing stock price of $9.23. The announcement sent TriQuint shares soaring by nearly 20%, to $10.99, at Monday's opening. RF Micro shares opened 15% higher, to $6.67.
Hillsboro, Ore.-based TriQuint, founded in 1985, makes components such as premium filters that are used mostly in mobile devices. The company has about 2,900 employees with operations in Texas, Florida, Costa Rica and the Philippines.
RF Micro CEO Bob Bruggeworth said Monday that increasing demand for mobile device software makes Monday's merger ideal. "The world's demand for mobile data is growing exponentially," he said.
Bruggeworth will lead the new company while TriQuint CEO Ralph Quinsey will become non-executive chairman.
"The alignment of culture between the two companies and the well matched products, capabilities and technologies will create compelling new opportunities," said Quinsey.