Brussels, 18/09/2015 (Agence Europe) - On 18 September, the European Commission announced that it has given approval to the acquisition of Freescale (Bermuda) by NXP (the Netherlands), subject to divestment of NXP's radio frequency power business.
The Commission was concerned that the takeover could otherwise have led to higher prices and less competition in this specific market. Both companies manufacture semiconductors at the global level. Semiconductors are used in various electronic components (such as diodes and transistors) that control the conduction of electricity.
To address the Commission's concerns, NXP has offered a) to sell its radio frequency (RF) power business, comprising all key assets and personnel, except assets necessary for the “front-end” manufacturing of these products, that is imprinting substrate silicon wafers with the precise circuitry required for semiconductors to function; b) a manufacturing agreement with a third party foundry to perform front-end manufacturing services for the divested business; c) to provide the RF power business with the transitional manufacturing and services agreements required to guarantee business continuity.
The commitments offered by NXP will allow the purchaser of the divested business to replicate NXP's previous role in the RF power transistors market thereby maintaining effective competition. The commitments completely remove the overlap between the RF power transistor activities of NXP and Freescale, and therefore adequately address the competition concerns identified by the Commission. (Élodie Lamer)