IDT to extend power technology with ZMDI acquisition
IDT will acquire privately held ZMDI (Zentrum Mikroelektronik Dresden AG) for $310M in cash. IDT says it gains, "A highly regarded automotive and industrial business, and extends [its] technology leadership in high performance programmable power devices and in timing and signal conditioning."
With this move, IDT says it immediately gains an expanded presence in new designs in Wireless Charging, Power Management, and Timing & Signal Conditioning.
"This move accelerates progress to our $800M annual revenue goal within our industry benchmark financial performance by over a year," said Gregory Waters, IDT President & CEO. "IDT’s strategy is unchanged, but our product and technology position is significantly expanded. Our target market segments of Consumer, Communications, and High Performance Computing all benefit from additional product, revenue, and customer relationships that bolster our commitment to outgrow the semiconductor market by at least a factor of two."
IDT extends its line of programmable power devices, with new high-power products addressing Communications Infrastructure and Data Center applications. This creates (the company adds) a high performance, scalable power management solutions that cover applications ranging from Wireless Charging to Solid State Drives to Data Centers & 4G/5G base stations.
From Dresden to California
"We gain an exceptional group of talented people and intellectual property from ZMDI, who join one of the technology industry’s fastest growing companies. With the added benefit of IDT’s cost structure and high volume manufacturing capability, we expect ZMDI revenues to achieve a similar financial model as IDT’s existing business in the first year of combined operations," Waters added.
ZMDI’s signal conditioning products provide an interface between microcontrollers and analogue components, such as sensors, which IDT sees as complementary to IDT’s Advanced Timing products, and will enable intelligent systems that are aware of their surroundings, and can adjust system performance, timing, and power management automatically.
The transaction has been unanimously approved by the board of directors of both companies, with closing expected before calendar end.
Zentrum Mikroelektronik Dresden AG (ZMDI) is a supplier of sensing and digital power semiconductor solutions for automotive, industrial, medical, mobile sensing, information technology and consumer applications. These solutions enable energy-efficient products in sensing, power management and lighting.
IDT is active in timing, serial switching and interfaces, and adds analogue and system expertise to provide complete application-optimized, mixed-signal solutions for the communications, computing and consumer segments.
Additional points made by IDT include:
• [The acquisition] adds $20m of quarterly revenues to IDT at 57% gross margins
• Accretive to earnings in first full quarter following close
• IDT gains a growing Automotive & Industrial business, with immediate sales leverage for current products
• Creates an industry franchise in Intelligent Power semiconductors. ZMDI adds new digital power products addressing Communications Infrastructure and Data Centre requirements
• ZMDI products are largely sole-sourced, with very long product life cycles and high margins. Synergies recognised in first year of operation will reach IDT’s target business model of 60% gross margin.