Mellanox Technologies To Buy EZchip In $811 Mln Deal - Quick Facts

(RTTNews) - Cloud networking solutions provider Mellanox Technologies Ltd. (MLNX) agreed Wednesday to acquire Israeli fabless semiconductor company EZchip Semiconductor Ltd. (EZCH) for $25.5 per share in an all-cash deal valued at about $811 million or about $620 million net of cash. The terms of the transaction have been unanimously approved by both the Mellanox and EZchip Boards of Directors.

The EZchip acquisition is a step in Mellanox's strategy to become the leading broad-line supplier of intelligent interconnect solutions for the software-defined data centers.

The combined company will have diverse and robust solutions to enable customers to meet the growing demands of data-intensive applications used in high-performance computing, Web 2.0, cloud, secure data center, enterprise, telecom, database, financial services and storage environments.

Mellanox said it looks forward to combining employees from both organizations, and also intends to retain both companies' existing product lines.

The transaction, primarily subject to receipt of applicable regulatory approvals and the approval of EZchip's shareholders, is projected to close in the first quarter of 2016. Mellanox expects the transaction to be non-GAAP accretive from day one.

Mellanox intends to fund the transaction with cash on hand from the combined companies and $300 million in fully-committed debt financing.