MagnaChip Goes Private In $1.4B All Cash Deal

South Korean display and power solutions provider MagnaChip Semiconductor Corp MX inked an agreement with investment vehicles established by Wise Road Capital LTD and certain of its limited partners, namely South Dearborn Limited and Michigan Merger Sub, to become a private company in an all-cash transaction of $1.4 billion.

• The cash consideration is equivalent to $29 per share, representing a 54% premium to the March 2 closing price, or the last trading day before media reported third-party interest MagnaChip acquisition.
• MagnaChip's management team and employees would continue their roles with the domicile unchanged in Cheongju, Seoul, and Gumi, South Korea.
• Wise Road intends to transform MagnaChip into a leading player in the global display and power markets. Wise Road would further promote MagnaChip's international growth through additional investment and employing its global network.
• The MagnaChip board had unanimously approved the agreement.
• MagnaChip posted a 14.5% sequential revenue growth, operating income margin of 6.4% in the fourth quarter of FY20 driven by a strong 5G ramp-up and effective cost management as per CEO YJ Kim. Net income and EPS rose 161% and 135% to $17.3 million and $0.4, respectively. The company held cash and cash equivalents of $280 million as of December 31, 2020.
• MX stock has gained 123% in the last year.
• Price action: MX share prices traded higher by 27.9% at $26.1 on the last check Friday.