Leading semiconductor analyst IC Insights has recently updated the global semiconductor M&A landscape for the first half of the year. After a significant slowdown in the second half of 2021, the pace of mega-deals in semiconductor M&A regained momentum in the first six months of 2022. The new third quarter update reports that four large M&A deals have been announced so far this year, each worth between $1.9 billion and $9.4 billion, pushing the total M&A total for the first half of the year up to $20.6 billion. In comparison, the total value of M&A agreements for semiconductor companies, assets, product lines and related business operations in the first half of 2021 was US$18.2 billion, with four large M&A deals priced between US$1.4 billion and US$7.1 billion. According to the third quarter update, the total value of new semiconductor M&A deals in the last six months of 2021 was US$4.4 billion, the lowest value in the second half of the year since the beginning of the last decade.
year M&A value of US$22.7 billion in 2021. However, unless more M&A deals are struck during the remainder of 2022, the total value for the year is likely to fall below the recent annual norm of approximately $29 billion (+/- $2 billion), excluding the record high of $117.9 billion in acquisition agreements in 2020. the peak of semiconductor M&A announcements in 2020 included AMD's acquisition of programmable logic leader Xilinx for stock ( initially worth $35 billion) and Nvidia's (now failed) agreement to buy UK processor design intellectual property (IP) provider ARM from Japan's SoftBank for $40 billion in cash and stock. The agency's data shows that the four largest semiconductor acquisitions in the first half of the year accounted for essentially all of the $20.6 billion worth of M&A in the first half of the year. Several other smaller semiconductor acquisitions were worth less than $25 million in total. Note: IC Insights' M&A list covers acquisitions of semiconductor companies, business units, product lines, fabs and ownership of chip IP, but excludes acquisitions of software and system-level businesses by IC companies. IC Insights' list also excludes semiconductor capital equipment suppliers, materials producers, chip packaging and testing companies and design automation software companies. Topping the list of M&A deals in the first half of 2022 was an agreement by a Chinese investment consortium to acquire bankrupt semiconductor group Tsinghua Ziguang Group (Figure 2). in April 2022, Beijing Jianguang Asset Management Company Limited (JAC Capital) led a group of investment firms to complete a US$9.4 billion capital injection into Tsinghua Ziguang Group.
The second largest chip acquisition deal was Intel's acquisition of Tower Semiconductor, an Israeli pure-play foundry, for US$5.4 billion. the cash acquisition, announced in February 2022 and expected to close in early 2023, is part of Intel's move into the foundry business. in May 2022, California-based Max Linear announced an agreement to The acquisition is expected to close in the first half of next year. AMD announced in April 2022 that it was acquiring Milpitas, California-based packet processor and cloud software startup Pensando Systems for $1.9 billion to boost its presence in the data centre market and strengthen its position with Intel. The acquisition of Pensando was completed in May 2022.
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