Vishay to Buy Capella for $205M
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  • Move expands fast-growing opto business

    Ismini Scouras

    NEW YORK — In a move aimed at strengthening its optical sensor business, Vishay Intertechnology has agreed to acquire Capella Microsystems Inc. for $205 million.

    Capella, a fabless IC design company based in Taiwan, will enhance Vishay's optoelectronics line with several products, including ambient light sensors, proximity sensors, optical encoders, and color, UV, and gesture sensors. It will also help Vishay expand its reach into other markets, including telecom, mobile devices, PC, and consumer.

    Vishay, a major provider of passive components and discrete semiconductors, has cited the optoelectronics sector as a major growth opportunity, particularly in the area of sensors and high-performance couplers. Vishay's optoelectronics product line also includes infrared emitters, receivers, and LEDs, as well as custom-designed products for the automotive and industrial markets.

    "Capella will add crucial technological capabilities to our successful and growing opto business that we do not have in-house," Dr. Gerald Paul, Vishay's president and chief executive, said in a press release. The company could not be reached for comment.

    Matthew Sheerin, an analyst at Stifel Nicolaus in New York, wrote in a note to investors that Capella generated about $63 million in 2013 sales with gross margins of 48%. The company distributes its products mainly in China and rest of the Asia, he wrote, and it counts Samsung, HTC, Sony, and Dell among its top customers.

    As a percentage of sales, Vishay's optoelectronics business remains the lowest, accounting for approximately 10% of 2014 first-quarter revenue of $602 million. Vishay derived 29% of its revenue from resistors/inductors and 23% from diodes, while capacitors and MOSFETs each contributed 19%. However, optoelectronics garnered the highest profit margins -- 37% compared to Vishay's total gross margin of 24.1%.

    Vishay has grown over the years by pursuing an aggressive M&A strategy. Just last month, it acquired Holy Stone Polytech, a Japanese manufacturer of tantalum capacitors, for $21 million. Sheerin expects Vishay to continue making targeted specialty acquisitions, especially in the sensor market.

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