VANCOUVER — Semtech Corp. says it's buying Vancouver-based Sierra Wireless in an all-cash deal that values the cellular technology provider at US$1.2 billion.
The deal combines two companies focused on the so-called internet of things that promises to connect a huge range of devices and systems to the internet.
California-based Semtech says Sierra's cellular offerings including 5G and cloud services will allow the combined company to offer advanced connectivity options for their focus on industrial applications including supply chains, utilities, and smart buildings.
The deal has Semtech buying Sierra for US$31 per share, representing a 25 per cent premium to Sierra's closing price on July 29, the last day before speculation on the deal pushed up its share price.
Semtech says the deal has board of directors approval from both companies and it expects the deal to close in its 2023 fiscal year.
In light of the deal, Sierra released preliminary second quarter results that showed its revenues are expected to be between US$185 million and US$189 million, while adjusted earnings before certain deductions is expected to be between US$21 million and US$23 million.
This report by The Canadian Press was first published Aug. 3, 2022.
Companies in this story: (TSX:SW)
The Canadian Press