M/A-COM Technology Solutions Holdings, which provides over 2,700 semiconductor products, primarily for use in networks (including cable TV, cellular and fiber optic networks) and aerospace & defense, announced terms for its IPO on Tuesday. The Lowell, MA-based company plans to raise $100 million by offering 5.6 million shares at a price range of $17.00 to $19.00. At the midpoint of the proposed range, it would command a market value of $857 million. The deal size is down 57% from August 2011, when the company proposed a $230 million offering in its initial filing.
M/A-COM Tech saw sales increase significantly from $25 million in fiscal year 2008 to $310 million in FY2011 before plateauing in recent quarters. The $73 million in revenue for the 4Q11 represented a 3% decrease year over year and a 7% sequential decline. Management attributed the results to weaker demand in the networks segment and the October 2011 flooding in Thailand, which affected a contract manufacturing supplier. Still, the sequential growth rates in the two prior quarters were only 1% and 0.1%. Gross margin for the fourth quarter stayed flat at 43% and operating income was $8 million.
Private equity firm Summit Partners invested in 2010 and will own approximately 21% of shares after the offering. Directors John and Susan Ocampo together will have 57% post-IPO stake. M/A-COM Tech plans to list on the NASDAQ under the symbol MTSI. Barclays Capital, J.P. Morgan and Jefferies are the lead underwriters on the deal.
The most recent semiconductor company to go public, Invensense (INVN), is trading up 111% from its IPO price. The rest of the 2011 class has performed poorly though and are all trading below their IPO price: Sequans (SQNS) by 69%, BCD Semiconductor (BCDS) by 51%, MagnaChip Semiconductor (MX) by 15% and Freescale Semiconductor (FSL) by 8%. GCT Semiconductor (GCTS), a fabless supplier of 4G LTE and WiMAX wireless chips, expects to price this week.
