Chipmaker Renesas goes deeper into autonomous vehicles with $6.7

pmaker Renesas goes deeper into autonomous vehicles with $6.7B acquisition

Japan-based semiconductor firm Renesas — one of the world’s largest supplier of chips for the automotive industry — is scooping up U.S. chip company IDT in a $6.7 billion deal that increases its focus on self-driving technology.

Renesas produces microprocessor and circuits that power devices, and automotive is its core focus. It is second only to NXP on supply, and more than half of its revenue comes from automotive. IDT, meanwhile, includes power management and memory among its products, which focus on wireless networks and the converting and storing of data. Those are two areas that are increasingly important with the growth of connected devices and particularly vehicles which demand high levels of data streaming and interaction.

The acquisition of IDT — which is being made a 29.5 percent on its share price — is set to expand Renesas’ expertise on autonomous vehicles. The firm said it would also broaden its business into the “data economy” space, such as robotics, data centers and other types of connected devices.

Renesas has already demoed self-driving car tech, which puts it into direct competition with the likes of Intel . Last year, the firm paid $3.2 billion to buy up Intersil, which develops technology for controlling battery voltage in hybrid and electric vehicles, and IDT deal pushes it further in that direction.

“There’s little overlap between their product portfolios, so it’s a strategically sound move for Renesas. But it does seem like the price is a little high,” said Bloomberg analyst Masahiro Wakasugi.

The IDT deal has been on the table for a couple of weeks after Renesas first revealed its interest in an acquisition last month. It is expected to close in the first half of 2019 following relevant approvals.

>>> What to look at today - 11th of September 2018

Asian stocks traded mixed Tuesday as investors awaited fresh developments on the trade-war front. With U.S. yields on the rise again, a weakening yen gave Japanese stocks a boost.
Hong Kong stocks teetered on the brink of a bear market, weighed down by technology stocks, while equities in Shanghai drifted near the lowest level since January 2016. Relatively cheap valuations also helped Japanese shares outperform. The MSCI Asia Pacific Index lingered near a one-year low. U.S. two-year yields hovered near the highest level in a decade in the run-up to an anticipated Federal Reserve interest-rate hike later this month.
US After Hours  LMNR -16%, SONO -14%, MTRX -13%, CDMO +17%, CASY +5% following earnings/guidance

Nikkei +1.22% Hang Seng -0.33% CSI -0.15% Shanghai -0.15% Shenzen +0.05%

Eur$1.1616 CNH 6.8753 CNY 6.8661 JPY111.46 GBP 1.3054 CHF 0.9746 TRY 6.4611 RUB 70.39 WTI$ 67.62 +0.12%

S&P +0.15% EuroStoxx +0.15% FTSE +0.10% Dax +0.18%SMI +0.12%

Macro :
- Brazil Hedge-Fund Legend Increases Bet on Stocks Ahead of Vote
- North Korean Leader Kim Seeks Second Summit With Trump in Letter
- U.K. Brexiteers Are Said to Brace For New Fight Over EU Laws
- Beer Companies to Face More Difficult 2019, Berenberg Says

Keep an eye on :
- AALB NA : Aalberts Acquires Precision Stamping Co. Co-Planar; No Terms
- ARL GY : Aareal Bank Reaches Deal to Buy Düsseldorfer Hypothekenbank
- ABN NA : UniCredit May Consider BBVA, ABN Amro for Possible M&A: MF
- AABA US / 4689 JP : Altaba to Sell Yahoo Japan Shrs at 354 Yen/Shr
- AKRX US / FRE GY : Akorn News Interest Up, Shares Down; No Events; Peers Flat
- ARYN SW : Aryzta in Standby Underwriting Pact for EU800M Capital Raise
- ARYN SW : Aryzta Amends Debt Covenants Ahead of Capital Increase
- BBVA SM : UniCredit May Consider BBVA, ABN Amro for Possible M&A: MF
- BID US : Sotheby’s Gets Bearish Mention in Grant’s Interest Rate Observer
- BMW GY : VW Email to Daimler Suggests Defeat-Device Talks With BMW: HB
- CGG FP : CGG to Apply for Delisting of American Depositary Shares
- DOKA SW : dormakaba Full Year Net Sales Match Estimates
- ILD FP : Italy’s Auction of Speedy 5G Airwaves Generates $2.9 Billion
- FWB IM : Fastweb rumoured to interest Xavier Niel
- FRE GVY : Regulator’s Akorn Plant Review Uncovers Data-Integrity Issues
- INGA NA : ING CFO Timmermans to Step Down After Money Laundering Probe
- INS GY : Deutsche Bank Starts Offering for 18.3M, Half of Instone Shares
- LYFT IPO : Kingdom to Buy Shares in U.S. Ridesharing App Lyft From Alwaleed
- MDW FP : Mediawan Reorganizes Into Four Business Groups
- NAS NO ; Norwegian Air to Halt London-Singapore Flights in Jan.: Times
- NXPI US : NXP Semi Looks Poised to Rebound as Investor Day May Quell Fears
- ORY SM : Oryzon Receives Spain’s Approval for Phase IIa Ory-1001 Trial
- PGHN SW : Partners Group First Half Ebitda Beats Estimates
- PFC LN : Algeria to Renegotiate $600m Contract With Petrofac: Sonatrach
- PSX US : Berkshire Hathaway Reports Less Than 5% Phillips 66 Stake
- REP SM : Repsol Acquires Solar Producer Valdesolar: Expansion
- RYA LN : Ryanair Pilots, Cabin Crews Plan One-Day German Strike Sept. 12
- SCR FP : Covea Is Said to Keep Scor Listed After Takeover: Les Echos
- SEBA SS : SEB Says Global Economy Is Headed Toward ‘End of Upturn Phase’
- SBMO NA : SBM Offshore Reaches Final Settlement of Yme Insurance Claim
- SONO US : Sonos Sinks as FY18 Outlook Fails to Exceed Highest Estimates
- TIT IM : Italy’s Auction of Speedy 5G Airwaves Generates $2.9 Billion
- UCG IM : UniCredit May Consider BBVA, ABN Amro for Possible M&A: MF
- DG FP : Vinci Immobilier In Exclusive Talks to Buy Urbat Promotion
- VOW3 GY : VW Email to Daimler Suggests Defeat-Device Talks With BMW: HB

>>> Europe : Brokers Upgrades & Downgrades - 11th of September 2

>>> Up
* Colonial Upgraded to Hold at Kepler Cheuvreux; PT 10.40 Euros
* Equinor Upgraded to Equal-weight at Barclays; PT 240 Kroner
* J D Wetherspoon Upgraded to Buy at Berenberg
* Kion Upgraded to Buy at HSBC; PT 69 Euros
* Koenig & Bauer Upgraded to Buy at HSBC; PT 67 Euros
* Repsol Upgraded to Overweight at JPMorgan; PT 20 Euros
* Repsol Upgraded to Overweight at Barclays; PT 19.50 Euros
* Telecom Italia Upgraded to Neutral at Citi
* Telefonica Deutschland Raised to Hold at Kepler Cheuvreux
* Ubisoft Upgraded to Overweight at JPMorgan; PT 130 Euros
* UCB Upgraded to Hold at Jefferies

>>> Down
* Eni Downgraded to Underweight at Barclays; Price Target 19 Euros
* Galp Downgraded to Neutral at JPMorgan; PT 18 Euros
* Heineken Downgraded to Sell at Berenberg

>>> Initiation
* Abertis Reinstated at SocGen With Hold; PT 18.36 Euros
* AEW UK Rated New Buy at Liberum; PT 1.01 Pounds
* Barry Callebaut Rated New Underweight at Morgan Stanley
* BP Rated New Buy at Berenberg; PT 6.65 Pounds
* capsensixx Rated New Buy at Montega; PT 19.50 Euros
* Eni Rated New Hold at Berenberg; PT 18 Euros
* EQS Group Rated New Hold at Baader Helvea; PT 80 Euros
* Equinor Rated New Hold at Berenberg; PT 245 Kroner
* Galapagos Rated New Outperform at Bernstein; PT 100 Euros
* Hamburger Hafen Rated New Buy at Bankhaus Lampe; PT 25 Euros
* Inventiva Rated New Buy at Jefferies; PT 17 Euros
* Lindt & Spruengli Rated New Overweight at Morgan Stanley
* METabolic EXplorer Rated New Hold at Kepler Cheuvreux
* Remy Cointreau Rated New Equal-weight at Morgan Stanley
* Repsol Rated New Buy at Berenberg; PT 20 Euros
* Shell Rated New Hold at Berenberg; PT 31 Euros
* Total Rated New Buy at Berenberg; PT 65 Euros
* Uniqa Rated New Hold at Berenberg; PT 8.90 Euros

>>> Call

>>> Fastweb rumoured to interest Xavier Niel

Fastweb rumoured to interest Xavier Niel

Fastweb, the Italian telecoms unit of Swisscom (SWX: SCMN), is rumoured to have interested Xavier Niel, Neue Zuercher Zeitung reported in its market report.

Niel is the anchor shareholder of Swiss mobiles operator Salt, the German-language report noted. Further details were not provided.

FT : Japan’s Renesas to acquire IDT in $7.2bn deal

Japan’s Renesas to acquire IDT in $7.2bn deal

Chipmaker seeking to cement position in growing market for self-driving car tech

Japanese chipmaker Renesas Electronics has agreed to buy US rival Integrated Device Technology for an enterprise value of $7.2bn in a bid to cement its position in the growing automotive semiconductor market. 

Shares in Renesas, which had expressed its interest in IDT two weeks ago, rose as much as 7.8 per cent.

On Tuesday, Renesas said it will pay $49 a share, which represents a 16 per cent premium to IDT’s closing price on Monday. The deal, which follows Renesas’s $3.2bn acquisition of US chipmaker Intersil last year, will increase the Japanese group’s net debt level to ¥757bn ($6.8bn). 

Despite the high price, analysts said there was little overlap in the product portfolio of the two companies and will allow Renesas to expand its presence in the automotive segment to data centres and consumer devices. 

“The deal is extremely meaningful for us to win globally,” Bunsei Kure, the chief executive of Renesas, said at a news conference in Tokyo. Hidetoshi Shibata , the company’s chief financial officer, also signalled the company was open to carrying out additional deals. 

Formed in 2010, Renesas was a product of a Japanese government-orchestrated merger of the chip units of Hitachi, Mitsubishi Electric and NEC. After the 2011 earthquake and tsunami disrupted the global supply chain for carmakers, 

Renesas subsequently received a bailout from the state-backed Innovation Network Corporation of Japan (INCJ) and customer companies such as Toyota, Nissan and Panasonic as it also sought to fend off a takeover from KKR, the US private equity firm. The INCJ remains the biggest shareholder in Renesas.

>>> US After Hours Summary: LMNR -16%, SONO -14%, MTRX -13%, CDMO +17%


After Hours Summary: LMNR -16%, SONO -14%, MTRX -13%, CDMO +17%, CASY +5% following earnings/guidance

After Hours Gainers:

Companies trading higher in after hours in reaction to earnings/guidance: CDMO +17.2%, CASY +4.9%

Companies trading higher in after hours in reaction to news: SIGA +14.9% (awarded BARDA contract for TPOXX with value potential of up to $629 mln), SSTI +5.6% (after making new all-time highs and closing +4% on the day), NTNX +3.9% (announces $20 mln+ deal with DoD agency), TRVN +3.5% (FDA scheduled Oct 11 meeting of the Anesthetic and Analgesic Drug Products Advisory Committee to discuss safety/efficacy of oliceridine injection for the management of acute pain), SB +2.8% (Safe Bulkers agrees with Cosco Shipping Heavy to install Alfa Laval PureSOx Scrubbers), MEET +3.4% (Luxor Capital increases passive stake), BSX +2% (light volume; still checking), XL +1% (after AXA [AXAHY] obtained regulatory approvals for the acquisition that is now expected to close on September 12), CVNA +0.5% (continued strength after 11% move higher)

After Hours Losers:

Companies trading lower in after hours in reaction to earnings/guidance: LMNR -15.8%, SONO -13.8%, MTRX -13.1%

Companies trading lower in after hours in reaction to news: PACB -8.5% (proposed public offering of common stock; offering size not disclosed), NNBR -7.1% (announces public offering of 12.5 mln shares of common stock), ECYT -4.9% (Endocyte proposes $175.0 mln public offering of common stock and files for mixed securities shelf offering), PSX -2.7% (light volume; Berkshire Hathaway [BRK.A / BRK.B] lowers passive stake), OSTK -0.8% (CEO Patrick Byrne discloses the sale of OSTK stock and sends letter to shareholders discussing the sale of 10% of his stock holdings), CBS -0.6% (downgraded to Neutral from Buy at UBS)