Semtech in Talks to Buy Sierra Wireless at $31 a Share

Ed Hammond and Liana Baker, Bloomberg News

(Bloomberg) -- Semiconductor maker Semtech Corp. is in advanced talks to acquire Canadian peer Sierra Wireless Inc.

Semtech is discussing paying $31 a share for Sierra Wireless, it said in a statement on Tuesday, confirming an earlier Bloomberg News report. There is no certainty talks will continue or result in a definitive agreement, it said.

Sierra Wireless fell 4.8% to $28.28 at 10:04 a.m. in New York trading Tuesday, giving the company a market value of about $1.1 billion. Semtech fell 2.6% to $56.97, giving it a market value of about $3.6 billion.

Semiconductors have been an area of busy dealmaking in recent years despite the long regulatory reviews the transactions often face. MaxLinear Inc., a maker of chips for broadband communications, agreed in May to acquire Silicon Motion Technology Corp. Last week, the US House of Representatives delivered a boost to the domestic chip manufacturing, sending legislation for $52 billion in grants and incentives to President Joe Biden to sign.

Camarillo, California-based Semtech provides analog and mixed-signal chips, including wireless connectivity, power management and products used in video broadcast equipment.

Based outside Vancouver in Richmond, British Columbia, Sierra Wireless makes so-called Internet of Things technology, a set of components designed to equip electronic systems with internet connections. Semtech has been making inroads into this area and a takeover of Sierra would complement its Internet of Things business.

(Updates trading in third paragraph.)