These 2 Infrastructure Chip Designers Are Merging -- Are They a Buy?
A clear trend has emerged in the semiconductor industry. Focus has shifted to enterprise infrastructure equipment, and chip designers of all sorts are trying to expand their portfolios in this large and expanding market. Tiny chip designer MaxLinear (NASDAQ: MXL) is no exception. It is in the process of acquiring fellow chip designer Silicon Motion (NASDAQ: SIMO), a deal it hopes will be complete by the middle of 2023.
Mergers between companies that rely on the development of intellectual property (in this case, current and future chip engineering designs) can present an interesting opportunity for investors. This case is especially interesting because MaxLinear and Silicon Motion have both been blasted by the bear market as their tie-up is pending. Are these two small infrastructure chip stocks a buy right now?
MaxLinear announced in May 2022 its intention to acquire Silicon Motion, a leader in controllers for NAND memory chips. The addition would complement MaxLinear's internet infrastructure business, which specializes in wireless connectivity chips as well as broadband internet chip designs.
Source Fool.com
