Texas Instruments is a market leader in digital signal processors (DSP)s. DSPs are found in wireless phones, DVD players, automotive systems and computer modems. They also make logic chips, microprocessors, microcontrollers, display components and calculators.
National Semiconductor offers a variety of integrated circuits (IC)s, especially analog and mixed signal chips. The analog chips transform physical information -- light, sound, pressure and radio waves into data that a computer can use. National's chips are in a host of wireless communications, networking, medical, solar, automotive and industrial applications.
The deal calls for TI to pay $25,00 per share for National Semiconductor, a 78% premium to its closing price of $14.07. TI's shares fell 12 cents to $34.11 Monday.
TI chairman Rich Templeton said in a statement, "National has an excellent development team, and its products combined with our own can offer customers an analog portfolio of unmatched depth and breath."
TI expects to increase its market share from 14% or $6 billion to 17%, adding $1.6 billion.The acquisition would give TI's analog chips 50% of revenues.