News Worms
News Worms

Marvell Set to Acquire Cavium in $6B Network Silicon Deal

Marvell Set to Acquire Cavium in $6B Network Silicon Deal

Marvell Technology Group Ltd., a chipmaker looking to build itself a future outside of a declining area of the market, has agreed to buy Cavium Inc. for about $6 billion.

The transaction has been approved by the boards of both companies, with Cavium shareholders to receive $40 per share and about 2.2 Marvell common shares for each share of Cavium common stock. The exchange ratio was based on a purchase price of $80 per share, which is a 21% premium to Cavium's closing price on November 2, before media reports about the transaction first surfaced.

The acquisition will expands Marvell's portfolio and combine it with Cavium's portfolio.

Marvell has a market capitalization of $10 billion while Cavium, whose shares have risen more than 10 percent since the Wall Street Journal reported earlier this month that the companies were in advanced talks, has a market capitalization of $5.2 billion.

The deal is Murphy's first acquisition at the company.

Upon completion of the transaction, Marvell will have annual revenue of about $3.4 billion.

"This is an exciting combination of two very complementary companies that together equal more than the sum of their parts", said Marvell President and CEO Matt Murphy. The two will be able to deliver "comprehensive end-to-end solutions" for customers across cloud data center, enterprise and service provider markets, and Marvell's serviceable market.

IBD'S TAKE: Cavium is now ranked No. 40 on the IBD 50 list of top-performing growth stocks.

Chief Executive Matthew Murphy, who took the top job a year ago, has been focusing on Marvell's networking business to counteract declining demand for its chips used in hard disk drives of personal computers.

Marvell on Monday also updated its fiscal third-quarter sales and earnings estimates.

The transaction is expected to generate at least United States dollars 150 to USD 175 million of annual run-rate synergies within 18 months post close and to be significantly accretive to revenue growth. Marvell will release fiscal third-quarter results on November 28 after the market close.

"Our potential is huge".


editors' picks

November 21, 2017
Harrison Ford helps woman after auto crash
A Santa Paula Fire Department spokesperson said the driver suffered minor injuries and was transported to the hospital. Together, they were able to help get the woman out of the vehicle as they waited for paramedics to arrive.

November 21, 2017
OnePlus 3 & OnePlus 3T Get Android Oreo!!
As the OnePlus 5T is released worldwide, we've discussed the lifecycle of each OnePlus device - and the software updates therein. Instead, the developers had to keep things under control and released the smartphone which was running on 7.0 OS out of the box.

November 21, 2017
Valkyria Chronicles 4 announced for Switch
As a last-ditch attempt at capturing the Imperial Capital, the Federation decides to initiate Operation Northern Cross. Valkyria composer Hitoshi Sakimoto is coming back to again do the music for Valkyria Chronicles 4 .

November 20, 2017
Controversial Keystone Pipeline spills oil
Art Tanderup's family farm in Neligh, Nebraska, lies in the path of the 830,000 bpd Keystone XL project. Landowners in Nebraska, for one, are anxious about what a spill means for their water supply.

November 20, 2017
APCC celebrates birth centenary of Indira Gandhi
Hailing late Prime Minister Indira Gandhi as a statesman and a great human activist, District In-charge Minister Dr. Despite her surname Gandhi, she is not related to the family of Mahatma Gandhi.

November 20, 2017
Early turnovers seal Dolphins' fate in loss to Buccaneers
Dolphins' starting quarterback Jay Cutler picked an very bad time to have his first multi-interception game of the season. On Sunday, starting tailback Damien Williams produced a 69-yard run, which tied for Miami's longest run of the season.

November 20, 2017
Russell Simmons & Brett Ratner Accused Of Sexual Misconduct Against 17 YO
Simmons also noted that the pair were together for two days and one night, but mainly in public or with other people present. I'm deeply saddened and truly shocked to learn of Keri's assertions as to what happened over the course of that weekend .

November 20, 2017
Chris Thompson Carted off Field vs. Saints Due to Leg Injury
Kamara would then score on the two-point conversion to tie up the game, eventually forcing it into overtime. The kick was set up by two huge Mark Ingram runs, the first for 20 yards and the second for 31 yards.

November 20, 2017
Sasikala, Dhinakaran supporters protest IT search at Poes Garden
Meanwhile, Palaniswami blamed Sasikala's family for the search and said that the state government has nothing to do with it. TTV Dinakaran, criticised the Chief Minister and the other Ministers for being mute spectators for all the events.

November 20, 2017
Israel Ready to Work With Saudis Against Iran
However, much points to the consideration of "bold decisions" by Tel Aviv and Riyadh, including official visits and the establishment of diplomatic relations.