Analog Devices announced its plan to acquire Maxim Integrated Products in a $21 billion all-stock deal. The enterprise value of the transaction is $68 billion.
Under the terms of the agreement, Maxim stockholders will receive just under two-thirds of a share of ADI common stock for each share of Maxim common stock they hold at the closing of the transaction, which is expected to occur next summer.
Upon closing, current ADI stockholders will own approximately 69% of the combined company, while Maxim stockholders will own approximately 31%, the companies said. Two Maxim directors will join ADI’s board, including Maxim CEO Tunc Doluca.
Maxim’s focus on the automotive and data center markets combined with ADI’s strength in industrial, communications and digital healthcare are “highly complementary and aligned with key secular growth trends,” the companies said.
ADI's pivot toward health-related products amid the coronavirus pandemic has helped bolster it earnings, even as sales have somewhat lagged.
Jim Cramer noted that investors should wait until the smoke clears around the deal before Analog takes a spot on your shopping list.
Catch his full take in the video above.