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Avago Technologies agreed to buy LSI Corporation for $11.15 per share in cash, valuing the deal at $6.6 billion. The acquisition closed on May 6, 2014. Avago said the deal would expand its enterprise-storage business; later that month, it agreed to sell assets from two LSI divisions to Seagate for $450 million.
What did Avago agree to buy, and for how much?
On December 16, 2013, Avago Technologies Limited and LSI Corporation announced a definitive agreement for Avago to acquire LSI in an all-cash transaction. The agreed price was $11.15 per LSI share, and the companies valued the transaction at $6.6 billion. The companies’ SEC-filed announcement stated those terms.
The price per share and the total transaction value are related but distinct figures: $11.15 was the consideration for each share, while $6.6 billion was the stated value of the overall deal.
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Why did Avago want LSI?
Avago said LSI would add enterprise storage to its wired infrastructure, wireless and industrial businesses. The companies presented the combination as a way to broaden Avago’s business mix, describing their intended result as “a highly diversified semiconductor market leader with approximately $5 billion in annual revenues.” That $5 billion figure was an announcement-era projection, not a reported result after the acquisition.
#1 Best Overall
- Chipset: LSI SAS3008
- Firmware (FW) version: P16 (16.00.14.00) IT Mode
- Interface: 2 * SFF-8643 Internal 12Gbps, PCI-e 3.0 x8
- Package: controller card, full-height bracket, low-profile bracket
The same announcement projected $200 million in annual operating synergies by the end of fiscal 2015. This was a forward-looking target; the cited transaction materials do not establish whether Avago ultimately achieved it.
When did the acquisition close, and how was it financed?
Avago completed the acquisition on May 6, 2014, at the announced $11.15-per-share cash price. The closing release described the completed transaction as worth approximately $6.6 billion.
Rank #2
- Chipset: LSI SAS2308.
- Firmware (FW) version: P20 (20.00.07.00) IT Mode.
- Interface: 2 * SFF-8087 internal, PCI-e 3.0 x8.
- Package: controller card, full-height bracket, low-profile bracket.
LSI’s closing Form 8-K filed with the SEC reported three financing sources:
- Approximately $1 billion from the combined balance sheet.
- A $4.6 billion term loan.
- A $1 billion investment by a Silver Lake-affiliated entity in seven-year convertible notes bearing 2% interest.
These are the financing sources reported in the SEC-filed closing Form 8-K; they explain how the transaction was funded, rather than changing the announced price per LSI share.
Rank #3
- ENTERPRISE RAID CONTROLLER – Professional-grade PCIe RAID controller designed for managing multiple SAS or SATA hard drives and SSDs
- INCLUDES MINI-SAS BREAKOUT CABLES – Comes with high-quality Mini-SAS to SATA breakout cables for easy drive connectivity
- HIGH-SPEED PCIe PERFORMANCE – PCI Express interface ensures fast data transfer rates and stable operation in demanding environments
- HARDWARE RAID SUPPORT – Supports multiple RAID configurations (RAID levels depend on controller model) for data protection and performance
- IDEAL FOR SERVERS & NAS – Perfect for servers, NAS systems, virtualization setups, and data storage expansions
What happened to LSI’s flash businesses?
On May 29, 2014, Seagate and Avago announced an agreement for Seagate to acquire the assets of LSI’s Accelerated Solutions Division and Flash Components Division for $450 million in cash. This was a subsequent asset-sale agreement involving two divisions, not the original acquisition of LSI as a whole. Seagate’s announcement establishes the agreement; that release alone does not confirm that the asset acquisition later closed.
Quick Recap
Best Value
- Interface: SAS 12Gb/s
- Data Transfer Rate: 1.2 GBps
- 8 Channel
- Bus Type: PCIe 3.0 x8
- Achieve more than 1.5 million IOPS for performance-sensitive applications
Rank #4
- New - Retail
- 1-Year Limited Warranty
- LSI LSI00301
- LSI LSI00301 Logic Controller Card SAS 9207-8i 8Port Internal SAS/SATA 6Gb/s PCI Express Single
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