Macom To Divest Automotive Business To Autoliv

(RTTNews) - Semiconductor company M/A-COM Technology Solutions Holdings Inc (MTSI) on Thursday said it has agreed to sell its Automotive business to Autoliv ASP Inc.

The agreed consideration to M/A-COM for the Automotive business is to be $100 million in cash, subject to customary working capital and other adjustments, plus the opportunity to receive up to an additional $30 million in cash based on achievement of revenue-based earn-out targets through 2019.

The Automotive business represented about 18% of M/A-COM's consolidated revenue in its second quarter ended April 3.

Commenting on the transaction, John Croteau, M/A-COM Chief Executive Officer, stated, "The divesture will enable M/A-COM to realize its full potential as a pure-play high-performance analog company."

"We expect this divestiture will significantly accelerate M/A-COM's achievement of its target operating model of 60% non-GAAP gross margin and 30% non-GAAP operating margin," Croteau said.

The divestiture is expected to close in its fourth fiscal quarter of 2015, the company said.