TDK Corp. and InvenSense Inc. have entered into a definitive agreement where TDK has agreed to acquire all of the outstanding InvenSense shares for cash at an acquisition price of $13 USD per InvenSense share, for a total acquisition price of $1.3 billion USD. The transaction has been unanimously approved by the boards of directors of both companies. Completion of the transaction is expected in second quarter of the fiscal year ending March 31, 2018, and is subject to approvals by InvenSense shareholders and the relevant regulatory authorities. The acquisition will be completed through a merger of a newly created subsidiary of TDK with and into InvenSense, with InvenSense continuing following the merger as a wholly-owned subsidiary of TDK.
Through the acquisition of InvenSense, TDK will be able to strengthen its product line-ups and technologies, which is expected to enable the combined company to become a stronger player in broad based sensor solutions for IoT, automotive and Information and Communications Technology (ICT) by accelerating the sensor product roadmap to offer innovative next generation products and platforms. In addition, sensor fusion, the combination of various sensor technologies and software creates products with enhanced value solutions for customers across multiple fields.
InvenSense is a global motion sensor solutions provider, known mostly for its flagship six-axis and nine-axis motion sensors, which are used in some of the world’s most advanced consumer products and applications. In recent years its portfolio has expanded with additional solutions for inertial, environmental, microphone and ultrasonic sensors. InvenSense’s “fabless” manufacturing model enables development of high-performance and cost-effective products via its unique CMOS-MEMS production process, according to the company.
“TDK’s sensor business, one of its strategic growth areas, can be strengthened by merging TDK’s portfolio of magnetic sensor technologies and its wide range of sensor products with InvenSense’s expanding sensor technology. This acquisition is a fundamental element in TDK’s strategy to provide unique and high-value-added products and services in IoT. We aim to become a strong player in the sensor business with InvenSense as our perfect partner,” said Shigenao Ishiguro, TDK’s president and CEO.
The acquisition will enable TDK to combine InvenSense’s advanced suite of sensor and software platforms with its wide-ranging portfolio of magnetic, pressure, temperature and microphone sensors. In addition, sensor fusion, combining various types of technologies and product line-up, creates products with high-added value.
TDK’s current medium-term (three-year) management plan ending in March 2018 focuses on the importance of three areas: automotive, manufacturing devices and energy and ICT. As part of its strategy for growth in these key areas, TDK has identified sensors and actuators, energy units and next-generation electronic components as three product areas for strategic growth aimed at unlocking new business opportunities in the fields of Internet of Things (IoT). Sensors are viewed as an important IoT-enabling technology and TDK envisions greatly expanding this portion of its business and providing a broad range of sensor solutions to its customers.
TDK currently sells magnetic sensors that employ thin-film magnetic technology, which TDK has accumulated through its endeavors with hard disk drive (HDD) solutions over many years. Further, TDK’s product line includes pressure, temperature, electric current and various other sensor types, and TDK plans to expand its sensor business going forward.
“This is an exciting day for InvenSense as our proposed acquisition by TDK represents what we view as a compelling win for InvenSense’s shareholders, customers and employees. TDK understands the value of InvenSense’s suite of sensor and software platforms. This merger is the culmination of years of innovation and execution by our world-class employees,” said InvenSense’s President and CEO Behrooz Abdi. “Together with TDK, we see a bright future that leverages our commitment to innovation with TDK’s scale, significant partner relationships and distribution channel. Our strategic goals are aligned, and we are confident that together with TDK we will accelerate our roadmap to provide next-generation sensor technologies in key fields for the world’s most innovative companies.”
BofA Merrill Lynch is acting as TDK’s exclusive financial adviser and Jones Day is acting as legal counsel to TDK. Qatalyst Partners is acting as exclusive financial adviser and Pillsbury Winthrop Shaw Pittman LLP is acting as legal counsel to InvenSense.
