Synaptics Said to Push for Deal With Chinese Suitor by End-April

  • Two sides still negotiating price of about $110-per-share
  • Synaptics aims to announce deal by time it reports earnings

Synaptics Inc., the maker of touch-screen technology used in mobile devices and computers, is still in active discussions with a state-backed Chinese investment group on a deal that values the company at around $110 per share, people familiar with the matter said.

Synaptics is targeting a deal announcement for the end of the month, when it reports earnings, the people said, asking not to be identified because the negotiations are private. The Chinese group and Synaptics are still negotiating the price, which could be a few dollars above or below $110 per share, one of the people said.

Shares in San Jose, California-based Synaptics rose 7.3 percent, the most in about two months, to $87.21 at the close in New York, valuing the company at $3.2 billion.

The Chinese group includes insurance companies and financial institutions, as well as a 4 billion yuan ($617 million) integrated-circuit fund backed by BOE Technology, a Beijing-based maker of chips used in televisions and computer displays, the people said.

Beijing E-Town International Investment & Development Co., an investment arm of the Chinese capital, and China’s government-sponsored National Integrated Circuit Industry Investment Fund Co. are investors in the BOE-backed fund, one of the people said.

Semiconductor Deals

Chinese buyers have pursued U.S. semiconductor companies in an attempt to build out the country’s domestic technology. A deal would mean that Synaptics is reasonably confident that a transaction would be approved by the Committee on Foreign Investment in the U.S. Fairchild Semiconductor International Inc. turned down an offer from China Resources Microelectronics Ltd. and Hua Capital Management in February, which analysts said was likely motivated by concerns about U.S. approval.

Synaptics’ technology is primarily used in consumer devices and personal computers. Its chips control displays and the sensor grids that allow them to recognize touch. It also makes sensors that read finger prints and are used to unlock smartphones and provide user verification for other security applications in handsets. The company’s biggest customer is Samsung Electronics Co., according to Bloomberg’s supply chain analysis.

Final terms of a transaction haven’t been agreed upon, and a deal could still fall apart or be further delayed, according to the people. The parties had initially aimed to reach an agreement in early March after the Chinese New Year, people familiar with the matter said in January.

“We don’t comment on rumors or market speculation,” Synaptics Chief Executive Officer Rick Bergman wrote in an e-mail. A representative for BOE Technology declined to comment, saying by e-mail the integrated-circuit fund is “run and managed independently” and it doesn’t have “concrete operating information” on the company. 

Beijing E-Town didn’t answer three calls to its office and didn’t immediately respond to a request for comment sent through a contact form on its website. Contact details for the National Integrated Circuit Industry Investment Fund couldn’t immediately be located.

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