MediaTek sets eyes on Richtek to target PMIC space

MediaTek, a Taiwan fabless chip company, has revealed it plans to bid to buy Richtek Technology Corp., a fabless vendor of analogue and power management ICs (PMICs) also based in Hsinchu, Taiwan. MediaTek said the acquisition would give it a leadership position in PMICs and help it expand its line-up for the Internet of Things (IoT).

Initially MediaTek plans to acquire between about 35 and 51 per cent of the outstanding stock in Richtek paying $5.99 per share. This will cost MediaTek between about $310 million and $450 million. Upon completion of the tender offer, MediaTek plans to acquire 100 per cent of Richtek's outstanding shares and complete the acquisition in 2Q16, subject to relevant regulatory approvals.

Richtek, founded in 1998, is traded on the Taiwan Stock Exchange. In 1H15 the company made a profit of about $23 million on sales revenue of about $191 million.

MediaTek has been growing rapidly on its penetration into smartphone equipment and through the acquisition of MStar, another Taiwan chip company.

"As a global leader with significant presence in smartphones, tablets and the digital home, MediaTek offers tremendous growth opportunities for power management related products through the cross-platform advantage," said Ming-Kai Tsai, chair and CEO of MediaTek.

In the same statement Kenneth Tai, chair of Richtek spoke in favour of the acquisition saying it would enable the use of MediaTek's platforms for optimisation of power management performance at the system level.

- Peter Clarke
??EE Times Europe