Sunday, March 1, 2015

Ex-PEU Semiconducter Deal: NXP to Buy Freescale

Nasdaq reported:

NXP Semiconductors NV agreed on Sunday to acquire Freescale Semiconductor Ltd. in a combination that would create a chip giant with combined revenue of more than $10 billion.  

Private equity underwriters (PEU's) did leveraged buyouts on the two firms in 2006.  This was the period when PEU's did club deals to keep buyout prices down.  All the private equity firms charged in the collusion case settled out of court for nearly $600 million. 

After years of paying annual management fees and dividends to their PEU owners each company went public, NXP in 2010 and Freescale in 2011.  NXP's buyout of Freescale will be Carlyle and company's last chance for profit as PEU's hold 64% of Freescale's equity.