Put simply, the deal's rationale is to expand Micron's product breadth while allowing for accretion in a reasonable time frame - it looks like they achieved both.
Micron shares are down, however, as the entire transaction will be financed by issuing about 140million new shares (or up to 150 million shares depending on where MU stock trades leading up to the deal's close). I guess the 6% drop in the shares could be worse, considering the potential 17% dilution to the share base. They're using all stock, despite having $1.56 billion in cash on the balance sheet....umm color me confused.
Micron has north of a 20% Free Cash Flow Yield, so shares are probably headed higher. This is also probably a decent outcome for ST Micro and Intel, both of whom own stakes in Numonyx. They'd previously intended to IPO the company, but now they'll get some shares of what to me looks like an undervalued Micron.
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