Semtech Corp. announced on Thursday that it had completed its acquisition of Sierra Wireless Inc. in an all-cash transaction valued at $1.2 billion.
The deal will nearly double the amount of annual revenue brought in by the Camarillo semiconductor and Internet-of-Things (IoT) products manufacturer and adds about $100 million of IoT cloud services recurring revenues.
Mohan Maheswaran, chief executive of Semtech, said that by combining Sierra’s strong and diverse device-to-cloud IoT products portfolio with his firm’s long range, low power (LoRa)-enabled end nodes, he believes that they are well positioned to deliver a highly differentiated, end-to-end platform to enable the transition to a smarter, more sustainable planet.
“Our combined company will have strong expertise in high bandwidth cellular connectivity, ultra-low power LoRa connectivity, IoT software and services, and extensive knowledge of IoT hardware and software channels and vertical markets,” Maheswaran said in a statement. “We believe that Semtech is uniquely positioned to deliver a strong product portfolio and service model to customers across high growth IoT segments.”
Former Sierra Wireless senior leaders join the Semtech leadership team in two newly formed business groups, according to a release from Semtech.
Tom Mueller joins as executive vice president of the IoT System Products Group, which includes Semtech’s existing LoRa products business and is responsible for the systems business for Semtech’s LoRa and cellular products. Most recently at Sierra Wireless, he served as vice president of products, overseeing the product and services portfolio.
Ross Gray joins as vice president of the IoT Connected Services Group where he is responsible for all managed connectivity and Cloud services for the IoT market. At Sierra Wireless he served as vice president for connectivity solutions.
Pravin Desale also joins Semtech as the senior vice president of IoT Engineering driving product development of its new systems and solutions. At Sierra Wireless, he served as senior vice president of engineering, overseeing global engineering and managed connectivity operations.
With the closure of the deal, Sierra shares will be delisted from the Nasdaq and the Toronto Stock Exchange.
The announcement was made on Thursday. On Friday, shares in Semtech (SMTC) closed up 53 cents, or at about 1.7%, to $31.24 on the Nasdaq, on a day when that market closed up at about 0.7%.