Infineon linked with buyout bid(2)

Private equity interest in the computer chip manufacturing sector shows no sign of waning, with reports that Infineon, a listed German company, is the target of several leading buyout groups.

A number of private equity firms are reportedly circling Infineon, a German listed chip manufacturer. Based on its current market capitalisation of about €8 billion ($10.4 billion), it would be the biggest private equity deal completed in Germany to date.

CVC Capital Partners, Kohlberg Kravis Roberts and Silver Lake Partners are just three of the firms to have approached Infineon about a possible deal, according to FT Deutschland.

But Guenter Gaugler, a spokesman for Infineon, told Bloomberg that the reports were unfounded. “We are not aware of any offer or approach by private equity companies,” he said.

The FTD suggests that the company’s management has so far refused to back any take-private bid, while Wolfgang Ziebart, Infineon’s chief executive, wants to restructure the company without help from private equity investors.

Infineon would be the latest in a string of chip-makers to be targeted by private equity firms. Last year a consortium led by the Blackstone Group paid $17.6 billion (€13.6 billion) for Freescale, a US semiconductor business, while a buyout group led by Kohlberg Kravis Roberts paid €8.3 billion for a semiconductor unit owned by Dutch industrial group Philips.

A successful deal for Infineon would also represent the first time that a large listed German company has been taken private, and may re-ignite speculation about other potential targets in the DAX index. Tyre maker Continental and truck group MAN are just two other firms that have attracted private equity interest in recent years.