Dialog Semiconductor plc has signed a definitive agreement to acquire Creative Chips GmbH, a prominent supplier of Integrated Circuits (ICs) to the Industrial Internet of Things (IIoT) market. Dialog acquired the fabless semiconductor company, headquartered in Bingen near Frankfurt, Germany, for $80 million in cash with an additional contingent consideration of up to $23 million, based on future revenue targets in 2020 and 2021.
Creative Chips has a growing IC business supplying industrial Ethernet and other mixed-signal products to manufacturers of industrial and building automation systems. The technology is optimized to efficiently connect large numbers of IIoT sensors to industrial networks. Building on its long-established custom IC business, Creative Chips is also developing a range of complementary standard IO-Link IC products, driving broader connectivity in the Industry 4.0 revolution.
Dialog expects the acquisition to help capture the growing Industrial IoT market, by acquiring a portfolio of core IC products and a broad library of relevant analog, digital and RF technologies. The acquisition enables Dialog to access Creative Chips’ portfolio of top-tier, established industrial customers to help expand its reach into existing wireless low power connectivity, configurable mixed-signal and power management ICs, while establishing a key strategic building block to capture the Industry 4.0 market.
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In addition, the deal enables Dialog to leverage Creative Chips’ experienced engineering team that, when combined with Dialog’s worldwide engineering, marketing and sales teams, will accelerate global IC sales.
“The acquisition of Creative Chips is instrumental for Dialog, giving it a strong foothold in the Industrial IoT market, while still highly complementary to Dialog’s current mixed-signal business,” said Jalal Bagherli, CEO of Dialog, in a statement. “The addition of Creative Chips and its team of highly experienced and talented engineers will help to further diversify Dialog’s product revenues, customer base and end markets by extending our reach in the industrial sector in addition to strengthening our automotive offering. We look forward to welcoming the whole team to Dialog.”