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Texas Instruments Buys National Semiconductor For $6.5B 121

Posted by Soulskill
from the getting-chippy dept.
CWmike writes "Texas Instruments on Monday announced it has agreed to acquire semiconductor company National Semiconductor for $6.5 billion in an all-cash transaction. TI, which makes low-power chips, said it would combine its 30,000 analog products and advanced manufacturing capabilities with the offerings of National Semiconductor, which makes analog integrated circuits. The acquisition is subject to customary closing conditions, and is expected to close in six to nine months, the companies said in a joint statement. Look out, [chip maker name here]?"
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Texas Instruments Buys National Semiconductor For $6.5B

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  • So, does this mean that TI prices will be even higher than that of before?
    • by dohzer (867770)

      What do you mean? Texas Instruments samples have always been free for me!

      • by Trogre (513942)

        Well, yes. It's people like you who keep requesting free samples with no intention of actually purchasing anything from them that has caused entire universities and countries to be banned from the sample program.

        Please stop.

    • by mirix (1649853)

      Depends I guess, I seem to notice for a lot of things... from archaic 74xx glue logic chips, to SMPS controllers and such, natsemi chips are usually double the price of a identical or similar TI chip.

      National has a big selection of random analog stuff that TI doesn't seem to produce, so I guess its a way to get a wider presence...

      Not sure about their microprocessors and shit like that - didn't natsemi sell theirs years back anyway? - geode at least.

      • by tuxicle (996538)

        Is this based on Digikey? I think that Digikey has lower prices for TI chips in general (relative to other retailers). Probably worked out some kind of deal.

      • by squizzar (1031726)

        You don't pay the RRP for a chip though, you get a NSM sales rep (or any company) and you explain that you would like to use their chip, but the competitors chip is better priced and offers similar features. The prices then become more competitive. I'm guessing that won't work for very small numbers of chips, but if you're only using a few what difference does a few dollars make?

        • by Hartree (191324)

          If you're a small custom contract electronics shop here in the US with two or three people, a few dollars a chip can make a big difference. Multiply that by how many chips on whatever board you're making and it adds up quickly. Especially in a down economy where manufacturers aren't ordering many custom control boards for production lines or other uses.

          Some of the contracts will be quite profitable, but many will be marginal at best. As we said around the shop (no longer in business) "You have to kiss a lot

    • by ArchieBunker (132337) on Monday April 04, 2011 @10:00PM (#35716280) Homepage

      TI no longer keeps stock on many chips. When the distributors run out the factory sits and waits for the orders to come in. Some of these chips have lead times of 26 weeks, half a year! You're basically screwed and have to start bargaining with brokers.

      • That's been true forever. TI was always the WORST for no-stock/long-lead-time screwage. I can remember screaming at a Hamilton-Avnet rep back in the early 80's that "I could go home tonight and order a baby and have it delivered before that!".
        • by tibit (1762298)

          I agree. I used to use their DACs, been badly burned and had to go through three board revisions: first I used a 4 channel chip, then a 2 channel version of the same thing, then I switched to a similarly performing chip from ADI that was never out of stock, and cost less. The only TI parts I use are a good ADC that always seems to be in stock, and some logic glue that has multiple sources but comes cheapest from TI for some reason.

        • by Trogre (513942)

          +1, Funny

  • is the sound of thousands of laser printers firing up, and spitting out epic number of resumes

  • Email from TI (Score:4, Informative)

    by 320Timberwolves (897302) on Monday April 04, 2011 @08:04PM (#35715568)
    Dear valued customer,

    I am excited to let you know that TI has signed a definitive agreement to purchase National Semiconductor, uniting two industry leaders that have a common commitment to solving your analog needs. I want to reinforce TI's commitment to you, our customer, as we merge our two companies.

    This acquisition will allow us to address your analog needs with a product portfolio of unmatched breadth and depth. National's 12,000 products plus TI's 30,000 means more performance, power and packaging options when selecting the right ICs for your application. And we'll provide a common set of best-in-class online tools to make the selection and design process easier.

    Our combined sales and applications team of 2,500 will be larger than any in the industry so we can provide more customers with greater face-to-face support than ever before.

    Our manufacturing operations will offer more capacity to support your growth. TI's fabs and National's available capacity can enable higher production levels.

    While both companies will operate independently pending the close, our goal thereafter is to make the integration process as seamless as possible. No requalification of products will be necessary since National's manufacturing sites will continue to be utilized. Part numbers from both companies will remain the same. There will be no obsolescence of products.

    I'm excited about what the integration of our two companies will mean for you: an unmatched portfolio to meet your analog needs, an extensive sales and applications network to ease the design process, and manufacturing capacity to support your growth.

    You can learn more about the acquisition at www.ti.com/acquire, including answers to frequently asked questions and video messages from TI leaders regarding the acquisition.

    Thank you for choosing TI. I look forward to a great future together.
  • Stability (Score:4, Insightful)

    by ChrisMaple (607946) on Monday April 04, 2011 @09:45PM (#35716210)
    National Semi, although one of the big players and a significant innovator, has a history of getting into financial trouble. Texas Instruments is a more stable operation and has always given the impression that it was run by more sensible people. If the corporate cultures are compatible, I think this move is for the best.
  • by djtachyon (975314) on Monday April 04, 2011 @09:53PM (#35716250) Homepage Journal
    BAE Systems completes purchase [bizjournals.com] of Fairchild Imaging.
  • First TI popularizes auto-tune and now he enters the power management technology industry with an almost seven billion dollar buyout? This guy is AMAZING!

  • National had some the oldest fab equipment in the business. That place had equipment even China didn't want.

    But you know what they say.
    http://www.siliconvalleywatcher.com/mt/archives/2005/09/real_men_have_f.php [siliconvalleywatcher.com]

    • Re:Good. (Score:5, Insightful)

      by jimmyswimmy (749153) on Tuesday April 05, 2011 @01:02AM (#35717084)

      Well, at least when I got out of the semi business a few years ago you could still do a lot with old 5" and 6" wafers. There's a lot to be said for having your own process line, despite the fabless trend, especially in the analog world. An in-house analog process enables a semi manufacturer to build unique parts that a competitor can't as easily replicate. If you can get a higher voltage or current in a similar sized driver IC you can outsell on features, or you can shrink the die and match features and outsell on price. But if you're both buying the same process from the foundry, what advantage do you have that the competition can't get by offering your engineers more money?

      • by Bender_ (179208)

        TI is currently ramping their 300mm analog fab. Some analysists dubbed it "death star fab" - guess why...

      • There's also a lot to be said for having a captive fab when the DoD comes knocking and says "we want a part that *we* can guarantee doesn't have any backdoors in the silicon". NatSemi has a prototyping fab and a secure fab in Santa Clara, and the secure fab -- I'm told, insofar as I've never seen the inside as I don't have the clearance required -- will build you a part with your engineers as involved as you want, from design, through fab, to test and packaging. That's worth a lot to a bunch of customers,

  • by PopeRatzo (965947) * on Monday April 04, 2011 @11:34PM (#35716740) Homepage Journal

    it has agreed to acquire semiconductor company National Semiconductor for $6.5 billion in an all-cash transaction.

    TI has $6.5 billion in cash lying around and we're wondering why our economy is in the shitter and where all the jobs are?

    Corporate tax laws should be changed so they're taxed for wealth as well as income. Maybe they could put that money to work for something besides buying out the competition.

    • Re:"All cash"? (Score:4, Insightful)

      by MightyYar (622222) on Tuesday April 05, 2011 @12:01AM (#35716860)

      Corporate tax laws should be changed so they're taxed for wealth as well as income.

      Because it would be better if they paid all the rich owners a dividend?

      Ask the bank who is holding their $6.5 billion why they won't loan you any of that money, and the answers to THAT are why our economy is in the shitter.

      • by Trogre (513942)

        Uh, I thought the fact that banks *were* loaning out wads of cash to high-risk low-equity customers was a heavy contributor to the current mess we're in.

        • by MightyYar (622222)

          Uh, I thought the fact that banks *were* loaning out wads of cash to high-risk low-equity customers was a heavy contributor to the current mess we're in.

          And you would be correct. And now they've done a 180 and won't lend to anyone unless the government backs it. I bought a house last year and had to keep under the HUD limit. It's had the effect of pushing all of the houses in my neighborhood down towards the HUD limit, almost without regard to how well-kept or nice the house itself is.

          TI has "only" $1 billion in the bank. They need to borrow $5 billion and change. National has $1 billion in the bank, so that takes care of the collateral on another billion.

    • TI has $6.5 billion in cash lying around and we're wondering why our economy is in the shitter and where all the jobs are?

      The intelligent among us realize there is little to no connection between the two. Everybody with any intelligence keeps at least some cash around regardless of economic conditions.

      Corporate tax laws should be changed so they're taxed for wealth as well as income. Maybe they could put that money to work for something besides buying out the competition.

      Yeah. Tax success and prud

      • by PopeRatzo (965947) *

        Everybody with any intelligence keeps at least some cash around regardless of economic conditions.

        $6.5 billion is not "some cash". It's a war chest. And the war is against us.

        My biggest concern isn't even with the 'cash' it's with the anti-competitive, anti-free market behavior of buying your competition.

    • by JamesP (688957)

      Yes

      And they have it all in coins, to make matters worse

      It's all in a huge vault, with a big $ painted on the side.

      Ask for a Mr. Scrooge

    • by owlstead (636356)

      Why would they have that amount of cash lying around? Do you think there is this magic cash register somewhere with over 300 million 20 dollar bills? Most of the time, when I see transactions like these, the bought company picks up the tab by lending the maximum amount of money from the bank. Of course, the big cheeses get a lot of dough from the transaction. The ones that are actually in power, are now leading a bigger company, and get a higher salary.

    • So... the government takes a chunk of their assets and that encourages TI to hire more people... how exactly?

      • by PopeRatzo (965947) *

        So... the government takes a chunk of their assets and that encourages TI to hire more people... how exactly?

        This ain't so hard, QD. The more these warchests are taxed, the more investment the companies will make in new facilities and manpower.

        The notion is "use it or lose it". And "use it" does not include buying up your competition.

        If you look at the upper bracket tax rates historically, alongside unemployment rates and GDP, you'll find that once the upper bracket tax rates go above 50%, unemployment go

    • TI has $6.5 billion in cash lying around and we're wondering why our economy is in the shitter and where all the jobs are?

      No. Are you fucking stupid? A cash transaction doesn't mean TI wheeled at pallet of hundred dollar bills around. That "cash" is numbers in a bank account. The banks don't keep all the money you give them locked in a vault. They put it to work in investments.

      • by PopeRatzo (965947) *

        A cash transaction doesn't mean TI wheeled at pallet of hundred dollar bills around. That "cash" is numbers in a bank account.

        Yes, corporations refer to it as a "war chest". Most often, "war chests" are used to buy the competition.

        I hope you didn't think I meant to suggest that TI would be "wheeling" any "pallets" of hundred dollar bills around.

        Are you suggesting that "$6.5billion in cash" doesn't mean "$6.5billion in cash"?

    • by Doc Ruby (173196)

      Corporations should just have to pay sales tax on everything, just as everyone else should. Equity sales that transfer control (ie. >= 50%+1) would pay the sales tax on the cumulative equity purchased by the buyer - as would any subsequent equity purchases by that majority owner. At about 25%, that would be $1.625B (non-control equity sales tax could be 0.01-1%, depending on how much the equity industries cost the public to manage that year). Which could pay for the public's government services that are

    • by doccus (2020662)
      Yeah *that* was the bit that got me
  • Am I the only one still shocked that analog is pulling in this kind of cash?
    • Re:Still shocked! (Score:5, Insightful)

      by jimmyswimmy (749153) on Tuesday April 05, 2011 @12:55AM (#35717056)

      You shouldn't be. You can't do digital without analog, despite what every pointy-headed manager puts in his powerpoint slides. Power is analog and that's a sizeable fraction of your computer budget. Motor control (hard drives), sensors (you name it), a lot of user interface, are all analog. Even signal transmission is analog, although if you set your thresholds just right you can pretend it's digital. In fact this is where a lot of semi companies make their money, by encapsulating the messy analog into the chip so all you have to do is put down two capacitors and hook up the digital interface, because people are escared of analog.

      Can you tell I'm an analog guy? I sure hope so.

      • by WingCmdr (100480)

        Can you tell I'm an analog guy? I sure hope so.

        Yes, I can see that. What I don't understand is what you're doing on slashdot. This place is generally for comp sci types. Even though I'm an EE, I'm more on the digital side of things, with lots of software thrown in for good measure.

        • by Doc Ruby (173196)

          It's clear what you're doing on Slashdot: making baseless, arrogant assertions about the world, especially about Slashdot, especially about meaninglessly split hairs like "Slashdot is for digital EEs, not analog".

      • by JamesP (688957)

        Also, ADCs and DACs. As far as I remember National, Analog Devices and Philips had most ADCs (I mean, the good ones)

        Too bad most of them are stuck in a package today

        Can you tell I'm an analog guy?

        More or less, but yeah. Analog is cool, but it's difficult. Give me the digital part any day of the week.

        (Depends really, one thing is creating an amplifier from scratch/transistors, other is using Opamps, still, you have to play with it sooner or later)

        • by greed (112493)

          Good digital circuits--the guts on the IC anyway--aren't easy, either. It's one thing to build a flip-flop, say, from basic logic gates and just paste in the relevant FETs. It's another to go back to first principles and build a bistable multivibrator taking advantage of the unique properties of the FETs you're using and the features you want the flip-flop to have.

          In the data sheets, those equivalent logic circuits are often simply operationally equivalent; they don't represent the actual integrated circu

        • Analog is cool, but it's difficult. Give me the digital part any day of the week.

          Ha. I went from RF/microwave to fully digital. The former had become boring, buying pre-rolled amps and mixers and couplers and whatnot and putting them together on a board. Creating a gain profile was a highlight of the day. FPGAs are much more fun. My RF background did make things easier when I started doing digital above 1 GHz clock rates. I had an intuitive feel for VSWR and the need for terminations. Now they have digitally controlled terminations right on the FPGAs- bless you Xilinx.

    • by Alioth (221270)

      Analog is *enormously* important. It's just not trendy. The world is analog, and for one digital systems will need an interface to the analog world.

    • by Bender_ (179208)

      Analog is getting bigger and bigger. Many applications are driven by "green" technology - power devices for electric cars, control circuits and switching converters for power conversion, LED controllers and so on. The automotive semiconductor industry is very delighted with the current development. The last figures I heard were that 20-30% of the costs of a european mid range car are electronics, with a sharp upwards trend. American cars and cars for the american market are usually based on slightly simpler

      • by WingCmdr (100480)

        The last figures I heard were that 20-30% of the costs of a european mid range car are electronics, with a sharp upwards trend. American cars and cars for the american market are usually based on slightly simpler and older technology.

        The current figures are the electronics in a car account for over 50% of the costs.

    • Re:Still shocked! (Score:4, Insightful)

      by thegarbz (1787294) on Tuesday April 05, 2011 @05:15AM (#35717938)
      There's very little that is truly done digitally. Even switch mode powersupplies, switch means digital right? As in turning on and off right?, no these are analogue components with oscillators and complex feedback loops. Not to mention precision electronics often based on linear regulators with highly accurate temperature controlled references. Then there's power conversion and line matching too. The output of your serial port may be digital to you, but to me it's a charge pump converting digital logic levels to +/-15V. Data conversion, sensors, and even digitally sounding and looking things like hall effect sensors in fans which produce a pulse when the fan turns actually have a large analogue component.

      Without analogue our digital wouldn't work. Analogue circuitry does everything from providing power, to providing time references for digital pulses.
  • by Rollgunner (630808) on Tuesday April 05, 2011 @12:46AM (#35717018)
    Looks like the folks at National Semiconductor... (puts on sunglasses)... cashed in their chips.

    YEEEEEEEAAAAHHHHH !
  • That's going to be a hell of a lot of suitcases.
  • The danger here is that there aren't too many other chip makers. TI and National Semiconductor are definitely the biggest, and I can see TI building up a bit of a monopoly in some areas quickly, or at least increasing the profit margin. Perhaps we'll see some unknown chip maker rise in a few years to even the markt.
  • That's a lot of suitcases.
  • National has gone downhill since Robert Pease retired. If you don't know who Pease is, then you probably don't know much about analog electronics. Thats all I'm saying.

  • TI engineers leave to form Cyrix -> National Semiconductor acquires Cyrix -> Texas Instruments acquires National Semiconductor.

    (note: Cyrix's empty husk was actually sold off by National circa 1998)

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