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Integrated Device to Buy Rival Firm

June 17, 2005|From Associated Press

Integrated Device Technology Inc. has agreed to buy rival chip maker Integrated Circuit Systems Inc. in a cash-and-stock deal valued at $1.7 billion.

The agreement, reached Wednesday, would form a company that supplied relatively obscure but essential chips to makers of communications gear, computers and other electronic devices. The deal is expected to close in the fall, after shareholder and regulatory approval.

The combined company, which would retain IDT's name and be based in San Jose, would have the resources to pursue growth, said Greg Lang, chief executive of Santa Clara, Calif.-based IDT.

Under the deal approved by both companies' boards, ICS stockholders would receive 1.3 shares of IDT common stock and $7.25 in cash for each share of ICS stock.

At Wednesday's closing price, ICS was valued at $1.7 billion, or $23.54 a share.

On Thursday, ICS shares rose $2.03 to $21.27 while IDT shares fell $1.02 to $11.51.

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