Renesas Electronics Corporation, a semiconductor solutions provider, is set to acquire Sequans Communications S.A., a 5G/4G cellular IoT chip and module provider, following a memorandum of understanding between the two companies. The proposed acquisition will see Renesas offer $3.03 per American Depositary Share (ADS) of Sequans, valuing the latter at approximately $249 million, including $52 million net debt.
This total represents a premium of 42.3% to Sequans’ closing price on August 4. The transaction values Sequans at around $249 million, including approximately $52 million in net debt.
Sequans, founded in 2003, specializes in chipsets and modules for IoT devices. With expertise in low-power wireless devices, Sequans supports IoT applications at low data rates and comply with major regulatory specifications by carriers.
With the acquisition, Renesas executives claim to deliver solutions that effectively address the industry’s evolving requirements.
Renesas’ president and CEO, Hidetoshi Shibata, expresses excitement about the Sequans agreement. He highlights Sequans’ position as a frontrunner in the rapidly progressing cellular IoT market, with broad cellular IoT network coverage.
“The company’s technology gives Renesas a path to offer broad connectivity capabilities across IoT applications to address the evolving customer needs,” Shibata continues.
The transaction is expected to conclude by the first quarter of 2024, pending regulatory approvals and other customary closing conditions.
After finalizing the transaction, Renesas intends to incorporate Sequans’ cellular connectivity products and intellectual property into its core product portfolio. This integration will include microcontrollers, microprocessors and analog and mixed-signal front ends. The acquisition will allow Renesas to grow in the WAN market and strengthen its PAN and LAN connectivity product portfolio, the company says.
The cellular IoT market is experiencing significant growth, driven by the demand for various applications such as smart meters, asset tracking systems and smart cities.
Sequans’ chairman and CEO, Georges Karam, notes, “As many telecom operators around the world continue to invest in 5G infrastructure and with the expanding deployment of IoT applications, combining with Renesas opens up vast opportunities.”
This move follows previous acquisitions of Dialog, Celeno and Panthronics.
acquisitions | edge computing | IoT | Renesas | Sequans Communications