Boston, MA 10/15/2014 (wallstreetpr) – One of the biggest chip maker of the world for mobile devices, QUALCOMM, Inc. (NASDAQ:QCOM), will be buying CSR PLC (ADR) (NASDAQ:CSRE), which is a British chip-making company for US $2.5 billion, as the company makes an aggressive entry into technology for connecting devices like wireless home appliances which fall under the technology for Internet of Things.
The deal will enable QUALCOMM, Inc. (NASDAQ:QCOM) to grow in areas that CSR PLC (ADR) (NASDAQ:CSRE) specializes in. i.e. as CSR is a leading company in Bluetooth enabled portable and wearing devices, it will enable QUALCOMM, Inc. (NASDAQ:QCOM) to get access to a technology which is gaining growing importance in the minds of customers as they are increasingly looking for technology which allows them to control different types of electronic devices like televisions, air-conditioners, etc. using their smart phones.
CSR is mainly focused on different accessories around the smart phone and has a strong position in headsets and portable audio speakers as it has been a pioneer in the area of wireless Bluetooth technology, and is now witnessing a growing demand for wireless technologies and network-connected appliances for use in homes and cars.
CSR has presence in 11 countries and has reported revenues of US $960.7 million for the fiscal year 2013. Qualcomm will be paying GBP 9 per share for CSR, which will value the company at GBP 1.6 billion.
According to Steve Mollenkopf, CEO of Qualcomm, the takeover will help Qualcomm in unlocking new growth opportunities in connectivity technologies. Qualcomm expects that the CSR deal would add to its earnings per share in the year 2016, and the deal is expected to be completed by the summer end of 2015.
While the Board of PLC (ADR) (NASDAQ:CSRE) has unanimously approved the takeover, the approval of the company’s shareholders is yet to come, which is necessary for confirming the deal.
CSR which stands for Cambridge Silicon Radio, had also been in talks with Microchip Technology Inc. (NASDAQ:MCHP) in this past, but later declined the offer for merger as the amount of offer was not enough.