Dialog Semiconductor swoops in for US rival Adesto Technologies

Reading-based Dialog Semiconductor will acquire US rival Adesto Technologies in an all cash transaction in order to accelerate its expansion into the market for the so-called 'Internet of Things'.

Dialog said that it had agreed to pay $12.55 per share or roughly $500.0m for the 270-person strong Adesto, financed from its own balance sheet.

The transaction was expected to accelerate Dialog's move into the growing IoT market for smart buildings and industrial automation, which allows for seamless cloud connectivity.

Adesto's products, centred on smart building automation, were a complement to Dialog's own product suite oriented towards manufacturing automation, Dialog said.

The US company's wired industrial connectivity portfolio was also a good match for Dialog's own wireless portfolio.

It was also hoped that the tie-up between the two firms would unlock future growth in the artificial intelligence space, while adding scale to Dialog's IIoT sector capabilities and existing custom integrated circuit business.

The transaction was also expected to turn Dialog into one of the largest custom analog mixed-signal semiconductor providers.

It was also expected to be earnings accretive in the first calendar year after closing and to deliver annual cost synergies of approximately $20m.

For its part, Adesto had been anticipating full year 2019 revenues of roughly $118.0m with continued sales growth seen over the next few years.