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Semtech Corporation, a global supplier of high-performance analog and mixed-signal semiconductors and advanced algorithms, announced it will acquire all outstanding shares of cellular IoT solutions provider Sierra Wireless for US$31 per 
share. This all-cash transaction represents a total enterprise value of approximately US$1.2 billion. The acquisition, designed to significantly expand Semtech’s addressable market, is expected to approximately double Semtech’s annual revenue while creating a strong and diverse portfolio of connectivity solutions for the growing IoT market. The deal is also expected to be immediately accretive to Semtech’s non-GAAP EPS before synergies and generate US$40 million of run-rate operational synergies within 12-18 months after the transaction closes.
This acquisition brings together two important technologies for the future of IoT – LoRa and cellular – to enable the digitization of the industrial world with a comprehensive chip-to-Cloud platform. Semtech expects the combination of Sierra Wireless’ cellular capabilities across its modules, gateways, and managed connectivity, together with Semtech’s LoRa-enabled end nodes, to create a uniquely differentiated IoT portfolio that will enable a plethora of new IoT use cases. In addition, the combination of Sierra Wireless’ Cloud services offerings and Semtech’s LoRa Cloud services are intended to bring together a future Cloud services portfolio offering that will include enhanced security, provisioning, device management, and geolocation capabilities for power optimized IoT applications. This new Cloud services capability is expected to add greater than US$100 million of high-margin IoT Cloud services recurring revenues immediately.
Semtech expects the combined company will be well positioned to serve high growth segments such as:
• Supply chain, logistics and asset management
• Utilities, including water, gas, and electric metering
• Smart cities and building, including air quality monitoring and public safety
• Smart agriculture and species protection
This transaction is expected to close in Semtech’s fiscal year 2023.