Germany’s Dialog to buy Silego in IoT play

FRANKFURT: Germany’s Dialog Semiconductor is to acquire California-based Silego Technology Inc for up to US$306mil, helping to strengthen its position in the market for the so-called Internet of Things (IoTs).

Silego is a leading maker of configurable mixed-signal integrated circuits, or CMICs, which integrate multiple functions into a single chip that can be customised to perform different functions.

Dialog, announcing the deal in a statement yesterday, said it would pay US$276mil in cash plus an additional contingent consideration of up to US$30.4mil for privately owned Silego, which is headquartered in Santa Clara, California, and has around 235 employees.

While Dialog and Silego share several major customers, the deal will expand Dialog’s customer base to include Dell, Fitbit, Garmin, GoPro and Synapse, among others and expand Dialog’s reach into the Chinese market, according to a Dialog slideshow presentation seen by Reuters.

Dialog’s business is largely focused on power management chips used in mobile phones, for which Apple is a major customer. It has been looking in recent years to diversify into new markets including automotive and industrial internet.

The deal would expand Dialog’s addressable market by more than US$1.4bil, and the company said it expected the transaction to be accretive to its earnings per share in 2018 and accretive to gross margins.

The company’s product range comprises integrated power management, AC/DC power conversion, charging and low-power connectivity technology.