Apple Finalizes $600 Million Deal with Dialog Semiconductor
- Apple is making a big investment in iPhone power management technology from Dialog Semiconductor.
- Dialog will be receiving $300 million in cash for the transaction and another $300 million for products that will be delivered to the tech giant.
- The business deal includes management development facilities in Italy, Germany, and the U.K that will be transferred to the tech giant.
Apple is set to acquire Dialog Semiconductor and will be gaining access to assets as well as part of the existing workforce. After the announcement, Dialog’s shares shot up by 34%, which is now their current highest since 2002. The deal is a huge investment for the tech giant as it will get access to Dialog facilities in Europe. Depending on regulatory approval, the deal can close as early as the first half of 2019.
Last year Dialog announced that Apple had developed the technology to build its own power management chips and would not be requiring the chipmaker’s help anymore. The reveal caused the shares of the company to plummet. Dialog is responsible for the designs used in the power management chips seen in the current generation iPhones, iPads and other devices. The tech giant was Dialog’s biggest customer and accounted for almost 75% of the chipmaker’s revenue in 2016.
Apple and Dialog have had a long-term working relationship that dates back to the release of the earliest iPhone devices. Apple SVP Johny Srouji revealed “Dialog has deep expertise in chip development, and we are thrilled to have this talented group of engineers who've long supported our products now working directly for Apple. Our relationship with Dialog goes all the way back to the early iPhones, and we look forward to continuing this long-standing relationship with them.”
With Apple acquiring a large number of Dialog’s assets, the chipmaker has some time to reduce its dependence on the tech giant. Dialog CEO Jalal Bagherli revealed that the company is trying to identify new opportunities for growth in other market and they may expand to home speakers, fitness trackers or smartwatches in the future.
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