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Analog Devices Makes Big $14.8 Billion Acquisition

(Reuters) – Analog Devices said it would buy fellow chipmaker Linear Technology for about $14.8 billion, creating a company with a combined revenue of $5 billion.

Analog’s $60-per-share offer (ADI) represents a premium of nearly 24% to Linear’s Monday close.

Linear’s stock (LLTC) surged to $62.42, its highest since 2001, before being halted ahead of the announcement. Bloomberg was the first to report the deal. Analog’s shares rose to a 52-week high.

Analog Devices said it would offer $46.00 per share in cash and 0.2321 a share for each Linear share. The deal values the combined business at about $30 billion, the companies said.

The deal is expected to immediately add to Analog Devices’ non-GAAP EPS and free cash flow.

Founded in 1965 by two MIT graduates, Analog Devices competes with Maxim Integrated Products Inc and Texas Instruments Inc.

The companies make power management chips, data converters and amplifiers that are used in almost all electronic products.