MATTHEW BYATT
Managing Partner
Dialog Semiconductor plc (XETRA:DLG), a leading provider of power management, charging, AC/DC power conversion, Wi-Fi and Bluetooth® low energy technology, today announced it has signed a definitive agreement to acquire Creative Chips GmbH, a prominent supplier of Integrated Circuits (ICs) to the Industrial Internet of Things (IIoT) market.
Headquartered in Bingen close to Frankfurt, Germany, with an additional design center in Dresden, Creative Chips is a fabless semiconductor company with a growing IC business supplying a broad portfolio of industrial Ethernet and other mixed-signal products to top-tier, blue-chip manufacturers of industrial and building automation systems. The technology is optimised to efficiently connect large numbers of IIoT sensors to industrial networks. Building on its long-established custom IC business, Creative Chips is also developing a range of highly complementary standard IO-Link IC products, driving broader connectivity in the Industry 4.0 revolution.
The new acquisition is strategic for Dialog to establish itself as a proven supplier, well-positioned to capture the significant growth potential of the Industrial IoT market. It also provides Dialog with a rich portfolio of core IC products and a broad library of relevant analog, digital and RF technologies. The acquisition includes the addition of an experienced engineering team with a wealth of unique skills that, when combined with Dialog’s worldwide engineering, marketing and sales teams, will accelerate IC sales on a global basis.
Both companies operate well-established fabless semiconductor business models with a focus on mixed-signal products and technology. With Dialog’s global scale, operations, product development and extensive IC technology resources, the combined companies are strongly positioned to quickly address opportunities in the IIoT market.
“The acquisition of Creative Chips is instrumental for Dialog, giving it a strong foothold in the Industrial IoT market, while still highly complementary to Dialog’s current mixed-signal business,” said Jalal Bagherli, CEO of Dialog. “The addition of Creative Chips and its team of highly experienced and talented engineers will help to further diversify Dialog’s product revenues, customer base and end markets by extending our reach in the industrial sector. We look forward to welcoming the whole team to Dialog.”
With Creative Chips, Dialog gains an impressive set of top-tier industrial customers with trusted relationships that have been built over the course of nearly 20 years. This will extend Dialog’s global sales reach of its existing wireless low power connectivity, configurable mixed-signal and power management ICs while establishing a key strategic building block for Dialog to realise its larger ambitions in the Industry 4.0 market.
Creative Chips is expected to generate revenues of approximately $20 million in 2019 with revenue growth of over 25% per annum anticipated over the next few years. The acquisition will be funded from Dialog’s balance sheet for a cash payment of approximately $80 million, with an additional contingent consideration of up to $23 million, based on future revenue targets in 2020 and 2021.
The transaction is expected to close in the fourth quarter of 2019.
Lutz Porombka, CEO of Creative Chips, commented:
“Acuity has deep semiconductor sector expertise which was evident throughout the transaction. From the outset, Acuity understood our business and was able to relay this in a compelling way to an array of international buyers. In particular, I was extremely impressed with their ability to access the right senior people within large semiconductor companies. As a team we had no prior exposure to M&A, and we found Acuity´s support as they guided us through the process, invaluable. I can see why they have earnt their reputation as the most active European advisor in the sector and I would have no hesitation in recommending Matthew and his team.”
Matthew Byatt, Managing Partner at Acuity said:
“I am thrilled that Acuity Advisors has been involved in the sale of Creative Chips to Dialog Semiconductor. This transaction highlights once again the strength of our international semiconductor sector practice and is an excellent result. We have known Dialog for many years and they will make the perfect partner for the Creative Chips team and their portfolio of mixed-signal and digital ASIC and ASSP products.”
“Acuity has deep semiconductor sector expertise which was evident throughout the transaction. From the outset, Acuity understood our business and was able to relay this in a compelling way to an array of international buyers. In particular, I was extremely impressed with their ability to access the right senior people within large semiconductor companies. As a team we had no prior exposure to M&A, and we found Acuity´s support as they guided us through the process, invaluable. I can see why they have earnt their reputation as the most active European advisor in the sector and I would have no hesitation in recommending Matthew and his team.”
LUTZ POROMBKA | CEO
Creative Chips
Team Members
THOUGHTFUL SUB HEADLINE GOES HERE.
Matthew is a Co-Founder and Managing Partner at Acuity and leads the Acuity Advisors’ Deeptech practice.
Matthew has held senior leadership and corporate finance positions with some of the UK’s most successful and influential technology and consultancy companies. Roles with ARM, McKinsey and Cadence have given Matthew an exceptional insight into the world’s most successful businesses and a number of the UK’s eminent start-ups, underpinning his success at Acuity.
Matthew has considerable experience across a broad range of technology sectors throughout the UK, US and Asia, ranging from nanotechnology, semiconductor and cleantech to digital media and internet businesses. It’s experience that has given him a robust, well-developed and international network. Having also run and successfully exited his own business, Matthew has a deep understanding of the financial and emotional aspects of this demanding process, bringing a unique and authoritative perspective to each business sale.
One of Matthew’s strengths is understanding complex technical value propositions, one of the benefits of training as an electronic engineer. He gets to the heart of what drives a company’s value and communicates this persuasively to potential buyers and investors. Matthew understands a buyer’s motivation intuitively and delivers a compelling rationale for why a business sale should be of strategic interest. His insight consistently yields higher deal values and results in great successes for his clients.