Apple Appears Set to Lose Bid for iPhone Display Chip Maker to Synaptics

Discussion in 'iOS Blog Discussion' started by MacRumors, May 27, 2014.

  1. macrumors bot

    MacRumors

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    #1
    [​IMG]


    Back in April, rumors indicated Apple was in talks with chipmaker Renesas Electronics over the potential acquisition of its Renesas SP Drivers division, which produces chips for smartphone displays including for the iPhone.

    As it turns out, Renesas Electronics appears set to sell its stake in Renesas SP Drivers to Synaptics, another chip manufacturer, instead of Apple. According to Reuters, the talks between Apple and Renesas "failed to make progress", leading Renesas to move forward with Synaptics. Apple was originally offering 50 billion yen or $479 million for Renasas' 55 percent stake in the company, which is also partially owned by Sharp and Powerchip.
    Apple currently uses chips from Renesas Electronics in its iPhone displays, improving both image sharpness and battery life. It is unclear how a failed acquisition would affect the ongoing relationship between the two companies.

    [​IMG]
    While Reuters suggests that the deal between Renesas and Synaptics is all but certain, Nikkei claims that Apple is still interested but that pricing was a major obstacle.
    Renesas was also reportedly convinced by some of its non-Apple customers that their access to the company's components could be cut off if Apple were to acquire the division, driving Renesas to give an edge to Synaptics.

    Despite the possible failure to purchase Renesas SP Drivers, Apple's effort is part of a trend that has seen the company take a keen interest in controlling its own production supplies and core technologies in recent years. Apple recently signed a deal with sapphire producer GT Advanced Technologies and has also purchased several chip firms in the past, including P.A. Semi and Passif Semiconductor.

    Article Link: Apple Appears Set to Lose Bid for iPhone Display Chip Maker to Synaptics
     
  2. macrumors P6

    IJ Reilly

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    #2
    We can see why that offer might have seemed a little low.
     
  3. macrumors 68030

    Amazing Iceman

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    #3
    With two potential buyers, Renesas will try to squeeze as much money from either buyer now that there's some sort of competition between them.
     
  4. macrumors 6502a

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    cherry point
    #4
    I'll top their offer and bid $480!
     
  5. macrumors P6

    IJ Reilly

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    #5
    Throw in a couple of iPhones and you've got a deal.
     
  6. macrumors regular

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    #6
    You guys are too funny. 50 billion YEN is 489 Million USD. :D
     
  7. macrumors 6502

    Joined:
    Jan 14, 2006
    #7
    Wow. I didn't know Japan had fallen on such hard times. I'd better take my American dollars and head over there.

    On a more serious note: Apple can't pony up the dough for a chip maker but is allegedly ready to buy beats for billions?
     
  8. macrumors regular

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    Virginia
    #8
    Just a few missing zeroes...
     
  9. macrumors 68000

    ghostface147

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    #9
    I think they meant 490 million.
     
  10. macrumors 68000

    Cuban Missles

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    #10
    Took me a second, but now this is halarious. I will bid $1000, all cash, in unmarked $20 bills. I have the 50 bills in an envelope.

    LOL
     
  11. Administrator/Editor

    WildCowboy

    Staff Member

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    #11
    Thanks for spotting the error, folks. :)
     
  12. macrumors 6502a

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    #12
    I'm sure this chipmaker is not bringing in 1.5 billion a year with high margins like beats. Chips is a low profit market and this was for only a 55% stake. I'm sure their purpose was to make sure a competitor didn't get them. I don't think they will mind if this company does.
     
  13. macrumors 6502

    Joined:
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    #13
    Don't confuse valuation with revenue with profit.

    Beats has never earned a PROFIT of $1.5 billion per year. It might sell $1.5 billion worth of headphones. But, with that $1.5 billion in revenue they have to pay to make the headphones they sell, advertise, run the company, etc.

    Beats as a company is valued somewhere between $1 billion and $1.5 billion.

     
  14. macrumors 68000

    69Mustang

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    #14
    It just appears that Renesas wants a diversified customer base just as Apple wants a diversified vendor base. Smart move. To have all your chips in one basket isn't the best idea a company can have.

    /pun intended
     
  15. macrumors P6

    IJ Reilly

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    #15
    If Beats' margins are close to Apple's (and I suspect they are), then their annual earnings can be fairly estimated at around $500M. This would make the company very cheap indeed at $1-1.5B, as that would be a ratio of only two or three times earnings, and doesn't even take any of their assets into account.
     
  16. macrumors 68000

    ghostface147

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    #16
    And it's fixed.
     
  17. macrumors 68000

    Joined:
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    #17
    Maybe they can start distributing some crappy Chinese EarPod copies they can get off a streetcorner vendor in Shanghai and bump their worth by a few $billion.

    ----------

    And maybe they can hire someone to make an app for them too. Crappy EarPods plus an app should be worth $2billion at least!
     
  18. macrumors 65816

    VanillaCracker

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    #18
    After the Beats acquisition, I wouldn't accept anything under $3.2 Billion! No matter what my company was contributing :D
     
  19. macrumors 603

    Rocketman

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    #19
    Hmmm. $479m. Synaptics (SYNA) has a $2B market cap. Up 50% for the year and a P/E of 40 so they can afford to overpay for the tech and Apple can keep using the tech until SYNA crashes at which time AAPL can buy them on the open market for a 50% discount. Super high short interest right now.

    They are pouncing while they can! Root for them to do it in time!

    Apple's time will come.

    Rocketman
     
  20. macrumors 68030

    macs4nw

    #20
    In that context, that sure makes one wonder. Or they must have some wicked plans for Beats, far beyond what us mere mortals can envision.
     
  21. macrumors newbie

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    #21
    Are the iPad mini non retina and iPhone 5 going to support predictive text? I have the beta but am not able to use this feature.
     

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