L&T signs ₹183 Crore deal to acquire SiliConch Systems

9 Jul 2024 , 11:57 AM

Larsen & Toubro (L&T) has signed an agreement to acquire SiliConch Systems, based in Bengaluru, for ₹183 Crore. The acquisition aims to enhance L&T’s engineering and design capabilities in the fabless semiconductor sector.

L&T Semiconductor Technologies Ltd, a wholly-owned subsidiary of L&T, entered into the share purchase agreement on July 8, 2024, for a 100% stake in SiliConch Systems.

The acquisition is expected to be completed by September, pending customary closing conditions. The semiconductor ecosystem includes designing, manufacturing, and testing.

The acquisition cost includes an upfront payment of ₹133 Crore at closing, subject to adjustments, and a deferred payment of ₹50 Crore over four years, contingent on achieving certain targets and conditions.

SiliConch, established in April 2016, specializes in semiconductor Intellectual Property (IP) and Integrated Circuits (IC) design. It is a fabless semiconductor design company with 30 granted patents worldwide, focusing on system-on-chip IP development.

SiliConch generates revenue primarily through non-recurring engineering revenue and license fees. The company’s end customers are Original Equipment Manufacturers (OEMs) and fabless IC companies in the US, providing power management systems for smartphones, automotive, and accessories.