Sigma Designs Inc (NASDAQ: SIGM) rose Friday on word Silicon Laboratories (NASDAQ: SLAB) announced plans to buy Sigma Designs for $7.05 per share in cash.
A news release issued Thursday reported that the Austin, Texas-based Silicon Labs would pick up Sigma Designs in a cash transaction valued at approximately $282 million, subject to certain closing conditions. This price represents a 26% premium over Sigma Designs' closing price of $5.60 per share on Wednesday.
The Fremont, California-headquartered Sigma Designs provides solutions for the connected home including Z-Wave, a leading Internet of Things (IoT) technology for smart home solutions.
Z-Wave supplies some of the world's largest ecosystems of smart home IoT products with more than 2,100 certified, interoperable devices available from more than 600 manufacturers. The addition of Z-Wave will expand Silicon Labs' wireless connectivity portfolio and worldwide customer base for the connected home.
According to Silicon Labs CEO Tyson Tuttle,"The connected home represents one of the largest market opportunities in the IoT. Today, there is no single dominant wireless technology for home automation, and protocols include Wi-Fi, Bluetooth®, Zigbee®, Thread and proprietary.
"By adding Z-Wave technology to Silicon Labs' connectivity portfolio, we will be better positioned to serve this fast-growing market. Ecosystem providers and developers will have a one-stop shop for wireless connectivity solutions for the home."
Silicon Labs is a leading provider of silicon, software and solutions for a smarter, more connected world, whose technologies are “shaping the future of the Internet of Things, Internet infrastructure, industrial automation, consumer and automotive markets.”
Sigma shares opened Friday trading up $1.28, or 22.8%, to $6.88, while Silicon shares gathered 30 cents to $90.50.
