Lattice Semiconductor explores sale to Chinese suitor
01 March 2016
Lattice Semiconductor Corp, a US-based manufacturer of high-performance programmable chips used in mobile phones and tablets, is exploring a sale that has attracted interest from a prospective Chinese buyer, Reuters reported, citing people familiar with the matter.
Lattice Semiconductor, based in Oregon, is working with investment bank Morgan Stanley to look into the interest from potential buyers, including one from China, the report said.
Reuters aid it could not immediately identify the Chinese suitor and added that there is no certainty Lattice Semiconductor will agree to any deal, the report said.
With a market cap of around $680 million, Lattice Semiconductor was founded in 1983 by Norman Winningstad, Rahul Sud and Ray Capece.
The company manufactures high-performance programmable logic devices like FPGAs, CPLDs, & SPLDs that are used in smartphones, tablets, TVs, home theater devices, wearable devices and cameras. It has more than 8,000 customers worldwide.
Last year, it acquired provider of wired and wireless connectivity solutions Silicon Image, for $600 million, its biggest-ever deal in order to expanded its products for video customers.
But a deal is likely to be scrutinized by the US Committee on Foreign Investment (CFIUS), which has recently blocked Chinese companies from acquiring US chipmakers.
CFIUS is an inter-agency panel led by the Treasury Department which overlooks overseas acquisitions to see that such deals do not pose any risk to national security.
Citing an "unacceptable level of risk" that a deal would be rejected by CFIUS, California-based chipmaker Fairchild Semiconductor this month rejected a $2.6-billion bid from Chinese state-backed enterprises China Resources and Hua Capital and instead opted to a lower offer from Arizona-based ON Semiconductor. (See: Fairchild Semiconductor rejects $2.6 bn bid from Chinese firms over regulatory concerns)
Earlier this week, Unisplendour, a unit of China's state-owned Tsinghua Holdings Co, aborted its planned $3.78-billion investment in US hard-disk maker Western Digital Corp after CFIUS said that it would review the deal.
Apart from the semi-conductor industry, Dutch electronics group Royal Philips NV early this year, terminated its proposed $3.3-billion sale of its Lumileds business to Chinese private equity firm Go Scale Capital, after CFIUS blocked the deal on national-security grounds.