IC Insights will release its latest version of the 2021 McClean report, Global Semiconductor Comprehensive Analysis and Forecast, later this month. Part of the new report focuses on specific data on mergers and acquisitions in the global semiconductor industry last year.
In 2020, five major acquisitions and more than a dozen relatively small mergers and acquisitions brought the total value of mergers and acquisitions for the year to an all-time high of $118 billion, surpassing the $107.7 billion in 2015.
The five largest mergers and acquisitions in 2020, which took place in July, September and October, were worth $94 billion, or about 80 per cent of the total for the year.
Last year's wave of global semiconductor mergers and acquisitions began in July, when Yadno Semiconductor (ADI) announced that it would buy Maxim Integrated Products (MIP) for $21 billion (mainly in stock). The acquisition, which is expected to be completed in the summer of 2021, will increase its market share in analog and mixed-signal IC for automotive systems (especially self-driving vehicles), power management and dedicated IC designs. Before the announcement of the acquisition of MIP, the total value of semiconductor acquisitions in the first six months of 2020 was only $2.1 billion. Mergers and acquisitions totaled just $352 million in the second quarter of 2020, when the global economy had not yet recovered from the novel coronavirus epidemic.
After completing other smaller acquisitions in July and August, Nvidia announced in September that it would buy ARM from Japan's Softbank Corp. for a whopping $40 billion. For more than a decade, ARM has licensed almost all of the CPU technologies used in smartphones and is expanding it to many other applications in the Nvidia product line, including data center systems, automotive automation, robotics, and machine learning and acceleration technologies. In order to allay the concerns of other competitors in the industry, such as Qualcomm, Samsung and Apple, Nvidia immediately promised to maintain the independence of IP by licensing ARM to other semiconductor suppliers and system manufacturers. The acquisition is expected to be completed in March 2022, but must be approved by regulators in the US, UK, EU, South Korea, Japan and China.
Four weeks later, there were more big mergers and acquisitions in October. First, Intel announced the sale of its NAND flash memory business and 300mm fab in China to South Korea's SK Hynix for $9 billion. In the last week of October, AMD announced the acquisition of FPGA technology leader Cyrus for about $35 billion (cash plus stock), a deal scheduled to close by the end of the year. Also at the end of October, Marvell announced that it would buy Inphi, a semiconductor supplier of mixed-signal analog products, for $10 billion (stock plus cash). The acquisition is expected to be completed in the second half of 2021.
It is worth noting that the, IC Insights report focuses on semiconductor companies' business units, product lines, chip intellectual property (IP) and fab purchase agreements, but does not include semiconductor companies' acquisitions of software and system-level businesses. For example, the M & A list does not include Intel's $900 million acquisition of Moovit, an Israeli mobile application provider, in May 2020, mainly because the Israeli start-up is not a semiconductor company. IC Insights's acquisition list does not include transactions between semiconductor capital equipment suppliers, material manufacturers, chip packaging and testing companies, and design automation software companies.