Transphorm, Inc. (NASDAQ: TGAN) shares are making noteworthy strides on the U.S. stock indices today. At the last check during the current session, Transphorm stock has surged by 25.33%, reaching a trading value of $4.75. The impetus behind TGAN’s upward trajectory stems from the revelation of an acquisition bid.
Transphorm (TGAN) formally announced today that it and Renesas Electronics Corporation have entered into a final agreement. A Renesas subsidiary will purchase all outstanding shares of Transphorm’s common stock under the terms of this agreement for $5.10 in cash per share. This amount represents a premium over TGAN’s closing price on January 10, 2024, of almost 35%.
Moreover, it represents a significant 78% premium over the volume-weighted average price in the previous six months and a premium of almost 56% over the volume-weighted average price in the previous twelve months. Transphorm is valued at around $339 million in total in this acquisition.
The acquisition is poised to furnish Renesas with proprietary GaN technology, a pivotal next-generation material for power semiconductors. This strategic move will extend Renesas’ influence into burgeoning markets such as electric vehicles (EVs), computing (encompassing data centers, AI, and infrastructure), renewable energy, industrial power conversion, and fast chargers/adapters.
The surge in demand for highly efficient power systems as foundational components for achieving carbon neutrality underscores a broader industry shift toward wide bandgap (“WBG”) materials, exemplified by silicon carbide (“SiC”) and GaN. These advanced materials afford a more extensive range of voltage and switching frequency compared to traditional silicon-based devices.
Renesas plans to leverage Transphorm’s automotive-qualified GaN technology to pioneer innovative power solutions, including X-in-1 powertrain solutions for EVs, as well as applications in computing, energy, industrial, and consumer domains.
The board of directors at Transphorm has unanimously sanctioned the definitive agreement pertaining to the transaction and has urged Transphorm stockholders to endorse both the agreement and the merger.
In tandem with the agreement’s execution, KKR Phorm Investors L.P., holding approximately 38.6% of Transphorm’s outstanding common stock, has entered into a customary voting agreement with Renesas, committing to vote in favor of the transaction. The anticipated timeline for the transaction’s completion is the second half of the calendar year 2024.
