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September 11, 2006
Freescale Semiconductor Reportedly in Buyout Talks with Two Private Firms
By Mae Kowalke, TMCnet Associate Editor
According to the Times report, the sale—if completed—would be largest leveraged buyout in the history of the technology industry.
A Reuters article, also Monday, noted the following financial impacts of the potential buyout:
- Cost to insure Freescale's $10 million debt for five years increased by about 200 basis points, to roughly $287,00 per year
- Freescale’s 7.125 percent bond note, due in 2014, tightened 45 basis points to 1.26 percent, compared to 1.71 on Sept. 8 (the last recorded trade), according to data from MarketAcess.
A Slashdot.org blog entry noted that Freescale currently manufactures embedded processors and memory, but is probably best known “as the Motorola spinoff that supplied Apple its PowerPC chips before the shift over to an Intel ( News - Alert) architecture.”
In a statement issued Monday, Freescale confirmed only that the company “is in discussions with parties relating to a possible business transaction,” and warned that “There can be no assurances that any transaction will result from these discussions.”
Freescale declined in the statement to provide any further details, saying that it was protecting the interests of its stockholder, employees and customers.
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Mae Kowalke previously wrote for Cleveland Magazine in Ohio and The Burlington Free Press in Vermont. To see more of her articles, please visit Mae Kowalke’s columnist page.
(source: http://news.tmcnet.com/news/-freescale-semiconductor-report-buyout-talks-private-firms-/2006/09/11/1878136.htm)
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