The merger could have created a European company with more than $1.4 billion in annual sales but AMS said in a statement posted Tuesday, July 22, that it has terminated these discussions with Dialog Semiconductor and that it does not intend to make an offer for Dialog Semiconductor. Similarly Dialog said that "despite extensive discussions" it has been unable to agree suitable terms and has terminated discussions with AMS AG regarding a possible merger-of-equals of the two companies.
The talks had been going on for several months but news leaked out towards the end of June, causing share price movements and forcing the companies to acknowledge the discussions.
Fabless chip company Dialog, with products in mixed-signal, wireless connectivity, and power management, has been on a strong growth curve for several years lead by respected CEO Jalal Bagherli. AMS runs a 200-mm wafer fab near Graz, Austria where it manufactures power, optical and magnetic and RF circuits.
Although the deal was being referred to as a merger of equals Dialog has about twice the annual sales of AMS. In its statement Dialog said it will continue to execute on its strategy to become a leading provider of analog and mixed-signal semiconductors for such markets as smartphones, tablet computers, solid-state lighting and the emerging wearable and smart home segments.
"With the end of these discussions, it is business as usual, namely delivering increasing value for our shareholders. We will continue on our profitable growth path - as demonstrated by our track record – and build a truly vibrant, global and diversified mixed-signal semiconductor business," said Dialog CEO Bagherli.