NXP Completes Freescale Acquisition to Form Largest Automotive Chipmaker

NXP Semiconductors NV has completed its nearly $12 billion acquisition of rival Austin, Tex.-based Freescale Semiconductor Ltd. to create what the Dutch company describes as the world’s largest supplier of automotive semiconductors.

The merged operations are expected to have combined overall annual sales of more than $10 billion (€9.2 billion), with an estimated 40% of the total related to automotive electronics.

The deal, which was announced in March, will expand NXP’s existing electronics portfolio from infotainment, security and vehicle network products to include Freescale’s body electronics, powertrain and safety systems.

NXP also plans to use Freescale’s technology to develop an integrated radar chip to replace current ultrasonic radar technology used in advanced safety systems, company officials tell Reuters. The Dutch company also will target next-generation multimedia processors that enables dashboard video displays.

With the acquisition, NXP hopes to grow about 50% faster than the overall automotive chip market in coming years. The Freescale merger also enhances NXP’s position in health monitors, home automation and wearable devices.