Shares of the Magnachip Semiconductor Corporation (MX) stock were popping high after the announcement of its receival of unsolicited buyout bid from Cornucopia Investment Partners. MX stock price saw an uptrend of 11.31% a share at the time of this writing. MX stock closed previously with a $23.05 per share price. Let’s deep dive to explore more of it.
What’s Happening?
MX stock has confirmed Cornucopia Investment Partners’ unsolicited bid in order to acquire all of the common outstanding shares of South Korean display and power-based chip maker at a per-share price of $35 in cash. The offer also represents the group of investors including financial sponsors led by Mr. Tim Crown, Yango financial holdings, Sino-Rock Investment Management Company Limited, and Lombarda China Fund.The offer values the Magnachip at $1.66 billion and represents the premium of more than 50% to the MX’s last close.
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Previously on March 25, 2021, MX stock did sign the merger agreement with South Dearborn Limited, an affiliate of Wise Road Capital LTD, according to which Magnachip would become the wholly-owned subsidiary of the former for $29 per share price in cash while continuing its corporate existence.
Financial View of MX stock:
- According to first-quarter 2021 financial results, MX stock generated $123.0 million in revenue which is 13.9% less than the previous quarter revenue and 2.1% higher than the same quarter of the previous year.
- The gross profit margin for MX stock was 27.9% in the recently reported quarter representing 100 basis points more than the previous quarter gross profit margin and 370 basis points increase over the year.
- The GAAP diluted loss per share was reported $0.19 by MX stock in the first quarter of 2021 while $0.22 non-GAAP diluted earnings per share was reported for the same quarter.
- As of March 31, 2021, MX stock had cash and short-term investments of $290.19 million as compared to $279.94 cash and short-term investments by the end of December 2020.
Conclusion:
Investors are responding to the recent news by MX stock that confirmed the receival of an unsolicited buyout bid from Cornucopia Investment Partners by Magnachip. Magnachip board directors will carefully consider the proposal by taking advice from its legal and financial officers. In short, investors need to keep an eye on this stock.