MACOM Technology Solutions Holdings, Inc. (NASDAQ: MTSI) says it has entered into an agreement to sell the compute business it acquired as part of its Applied Micro Circuits Corp. acquisition (see "MACOM to acquire AppliedMicro"). MACOM acquired the communications semiconductor supplier in November 2016, and will sell the compute product line to the Carlyle Group-backed company Project Denver Holdings LLC.
MACOM will be issued a minority equity ownership interest under the sale's terms. According to MACOM, Carlyle Partners VI, a $13 billion U.S. buyout fund, will provide the equity for Carlyle's investment.
Except for the transfer of certain assets and entities in jurisdictions outside of the U.S., the divestment transaction was effective concurrently with the definitive agreement signing. Assets and entities in jurisdictions outside of the U.S. will be transferred once applicable foreign approvals are received, MACOM says.
"After a thorough review process, we are very excited about the sale of the compute business and the opportunity it provides for both the employees of that business and our shareholders," said John Croteau, MACOM's President and Chief Executive Officer. "The Carlyle Group is one of the world's largest and most successful global investment firms, with over $170 billion in assets under management. I believe NewCo's [Project Denver Holdings'] exceptional leadership team and Carlyle's backing combines the necessary elements to make the business a long-term success, and through a minority equity ownership MACOM is positioned to participate in the company's long-term value creation."
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