CNBC reports that the US tech giant has hired Barlcays to advise on a bid for the Israeli InfiniBand connectivity company.
According to CNBC reports US tech giant Xilinx, which has a market valuation of more than $22 billion, has hired Barclays to advise on a bid to acquire Israeli chipmaker company Mellanox Technologies Ltd. If the deal does happen, it’s expected to be announced in December.
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Mellanox shares price jump by more than 5% on Wall Street this morning to $93, giving a market cap of just under $5 billion. Sources familiar to the matter told CNBC that any deal would likely be for $5.5 billion, a 10% premium on the current market price.
Founded by CEO Eyal Waldman, Mellanox, a multinational supplier of computer networking products using InfiniBand and Ethernet technology. Buying Mellanox would give Xilinx a broader array of products to sell into the data center market.
Xilinx co-founder, Ross Freeman, invented the FPGA in 1984. Xilinx makes field-programmable gate array (FPGA) chips that are in used in circuit boards in data centers that run search algorithms and power artificial intelligence.
on Oct. 25 CNBC reported that Mellanox had hired a financial adviser to seek a sale after receiving takeover interest. Analysts at Piper Jaffray named Xilinx, Intel and Broadcom as three potential buyers. CNBC’s sources said that parties other than Xilinx may be interested in Mellanox.
Xilinx approach to the Israeli company with an offer continuing a trend of consolidation in the semiconductor industry.
Earlier this year Mellanox reached a settlement with activist investor Starboard Value that placed three new directors on its board.