Renesas Electronics is to acquire Integrated Device Technology (IDT), a supplier of analogue mixed-signal products.

A definitive agreement has been signed under which Renesas will acquire IDT for $49.00 per share in an all-cash transaction representing an equity value of approximately $6.7billion.

The boards of directors of both companies have unanimously approved the transaction, and closing of the transaction is expected to occur in 2019, following approvals by IDT shareholders and the relevant regulatory authorities.

Renesas is working to expand its analogue solution line-up and strengthen its kit solution offerings that combine its microcontrollers, system-on-chips, and analogue products. According to the semiconductor company, these efforts will be underpinned by revenue growth in its focus domains: automotive segment, which is expected to see “tremendous growth” with autonomous driving and EV/HEV; industrial and infrastructure segments.

The hope is that the acquisition will provide Renesas with access to an array of analogue mixed-signal capabilities in embedded systems, including RF, advanced timing, memory interface and power management, optical interconnect, wireless power, and smart sensors.

Renesas anticipates near- and long-term revenue growth from expanded opportunities and access to fast-growing industries, and cost savings from a greater scale business platform to bring innovation and improvements with an expected financial impact of approximately more than $250million (non-GAAP operating income per year on a run rate basis).

“The combination of Integrated Device Technology’s analogue mixed-signal leadership with Renesas’ microcontroller and automotive/industrial franchise creates a new global powerhouse,” said Gregory L. Waters, President and CEO of IDT. “The combined company will possess the key capabilities that customers in the modern data economy demand.”