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Equity group looks into acquiring Filtronic

Posted: 03 Jun 2008 ?? ?Print Version ?Bookmark and Share

Keywords:semiconductor? mobile? PA? wireless?

Filtronic plc, the British electronics group that has recently sold off its compound semiconductor division, including Europe's largest GaAs foundry in Newton Aycliffe, and over the last two years most of its activities in wireless communications and PAs in mobile handsets, is set to be acquired by U.S. private equity group Carlyle.

The company's shares forged ahead by 19 percent, to 75.25 pence previously, its biggest advance since October 1994, giving Shipley, England-based Filtronic, a market value of 55.9 million pounds ($111 million).

The private equity group confirmed it is reviewing its options to consider Filtronic, which could be an offer. However, it cautioned that the announcement has not yet been finalized about the firm's intention to make an offer and there is still no certainty when this will made.

Filtronic is a shell company compared to several years ago after recent disposals, including the compound semi-division to U.S. group RF Micro Devices Inc. (RFMD) for about $25 million, in a deal that provided for RFMD to retain the fab, which is already a supplier of GaAs pHEMT semiconductors.

Founded in 1997, the company sold its wireless infrastructure business a couple of years ago to another American company, Powerwave Technologies Inc., for 58 million pounds (about $116 million).

The other major divisions include some of the defense operations and the point-to-point division, focusing on transceiver modules and filters for backhaul microwave radios linking mobile base stations. Last year, the company said this moved into profitability and Filtronic said it is "well- positioned to exploit the growing market."

The company reported a net income of 874,000 pounds from its 27.2 million pounds sales within the last six months before November 2007.

Recently, Filtronic said its remaining business "remains satisfactory" and pointed out that it had 114 million pounds in cash after the disposals.

Carlyle is best known for making 240 million pounds from its four-year investment in another defense electronics company Qiniteq, where it bought a 30-percent stake from the U.K. government. The group was formerly known as Defence & Energy Research Agency.

- John Walko
EE Times Europe

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