Why Shares of IXYS Corp. Are Surging Today

Why Shares of IXYS Corp. Are Surging Today

Shares of semiconductor provider IXYS Corp. (NASDAQ: IXYS) soared on Monday after circuit protection company Littelfuse (NASDAQ: LFUS) announced that it was acquiring the company in a cash and stock deal. The transaction is valued at $655 million after backing out the net cash on IXYS's balance sheet, and it's expected to be immediately accretive to Littelfuse's bottom line. IXYS stock was up 36.5% at 10:45 a.m. EDT, while shares of Littelfuse were down 5%.

Littelfuse is paying a little more than twice sales for IXYS, which generated revenue of $322 million in fiscal 2017. IXYS shareholders will be entitled, per IXYS share, to either $23 in cash or 0.1265 of a share of Littelfuse stock, with each option accounting for 50% of IXYS stock. Littefuse will fund the cash portion of the deal with a combination of existing cash and additional debt.

A Littelfuse AF0100 Arc-Flash Relay. Image source: Littelfuse.http://www.littelfuse.com/~/media/protection-relays/press-image/littelfuse_af0100.jpg

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Source: Fool.com