Shares of Magnachip Semiconductor Corporation (NYSE: MX), the South Korean display and power solutions company, are surging on Friday after it announced it has entered into an agreement to be acquired by two investment vehicles established by Wise Road Capital LTD and certain partners.
Magnachip’s share price is currently trading 28% higher at $26.21.
South Dearborn Limited, a company incorporated in the Cayman Islands, and Michigan Merger Sub, Inc, a Delaware corporation, which are investment vehicles established by Wise Road, will take Magnachip public in a deal valued at $1.4 billion.
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Magnachip shareholders will receive $29.00 for each share of Magnachip’s stock they currently hold, representing a premium of approximately 75% to Magnachip’s 3-month volume-weighted average share price and roughly a 54% premium to the unaffected closing stock price on March 2, 2021.
Once the transaction is closed, Magnachip’s management team and employees are expected to continue their roles.
Magnachip’s CEO, YJ Kim, said the partnership will “provide an excellent opportunity to accelerate our MX 3.0 growth strategy. Given their deep industry expertise, Wise Road Capital is an ideal partner for Magnachip, and we look forward to working with them as we chart the next phase for our company.”