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Thursday, August 21, 2014

Infineon denies paying too much for International Rectifier, (NYSE: IRF)

Infineon brushed off concern that it was spending too much to purchase U.S.-based International Rectifier, saying the deal promised a wealth of benefits for the German chipmaker.Infineon announced the $3 billion cash deal late on Wednesday. The price was 51 percent above International Rectifier's market value before it was announced and Infineon shares fell in after-hours trading."The premia (in the chip sector) are high, but the 50 percent we are offering is pretty much in the middle of the bandwidth in this space," Infineon finance chief Dominik Asam told analysts during a conference call on Thursday.Asam said he saw "a good bunch of cost synergies" that made him comfortable with the premium Infineon has to pay, without giving more details.

International Rectifier Corporation (IR) designs, manufactures and markets power management semiconductors. Shares of IRF traded higher by 47.21% or $12.54/share to $39.10. In the past year, the shares have traded as low as $22.78 and as high as $39.50. On average, 929931 shares of IRF exchange hands on a given day and today's volume is recorded at 31558464.