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Microsemi Tweaks Q1 Sales Guidance; Gives Buyout Updates

Microsemi CorporationMSCC , a supplier of semiconductor components to defense, aerospace, industrial and communications markets, recently revised the revenue expectations for the first quarter of fiscal 2016.

The company also provided updates for the PMC-Sierra PMCS acquisition announced in Nov 2015.

Q1 Revenue Guidance Update

Microsemi had previously guided a revenue range of $325 million to $329 million for first quarter. However, the company now expects revenues toward the higher end of the range.

Microsemi is slated to report first-quarter results on Jan 28.

PMC-Sierra Acquisition Update

According to Microsemi, the proceeds from the $450 million senior notes offering and its credit facility commitments will enable it to finance the $2.5 billion PMC-Sierra merger.

In Nov 2015, Microsemi had agreed to buy PMC-Sierra for $12.05 a share, which includes $9.22 in cash and $2.83 as shares. With the buyout, the company will be able to provide storage solutions for data center and cloud applications and gain a complementary portfolio of high-value communications products.

Microsemi also reaffirmed that it will save in excess of $100 million annually from this merger, with more than $75 million to be realized in the first full quarter of the combined operations.

Also, Microsemi announced that the waiting period under the Hart-Scott-Rodino (HSR) Act has expired in relation to its proposed merger with California-based PMC-Sierra. The companies now expect the transaction to be completed on Jan 15, provided other customary closing conditions are met.

Microsemi currently has a Zacks Rank #3 (Hold). A couple of better-ranked stocks are MaxLinear, Inc. MXL and NXP Semiconductors NV NXPI , both sporting a Zacks Rank #1 (Strong Buy).

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PMC-SIERRA INC (PMCS): Free Stock Analysis Report

MICROSEMI CORP (MSCC): Free Stock Analysis Report

MAXLINEAR INC-A (MXL): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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