Third-highest chip company M&A year, establishes new normal

February 11, 2020 //By Peter Clarke
Third-highest chip company M&A year, establishes new normal
Seven major semiconductor acquisitions valued at $1 billion or more in 2019 helped bring the total to $31.7 billion, according to IC Insights.

The 2019 value of semiconductor acquisition agreements reached the third-highest annual total ever and up 22 percent from the previous year. However, it was still in the same region of $30 billion per year that has pertained since 2017 following the boom of 2015 and 2016. This has established a "new normal" for semiconductor acquisition activity, the market analysis firm said.

Value of semiconductor M&A agreement totals by year. Source: IC Insights.

With high levels of innovation around such areas as machine-learning and artificial intelligence, autonomous vehicles, human recognition, computer vision, virtual/augmented reality, and high-speed wireless connections to the ever-expanding Internet of Things, established players are having to move more quickly and more often to try and secure their positions, IC Insights said.

The average annual value of semiconductor M&A agreements between 2015 and 2019 is more than four times higher than the average in the prior five-year period (2010-2014).

Seven of the acquisition agreements in 2019 exceeded $1.0 billion and these included Infineon-Cypress, Nvidia-Mellanox, AMS-Osram, Intel and Habana Labs, On Semi and Quantenna and Apple's acquisition of Intel's 5G modem business.

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