NETHERLANDS - PE-backed NXP to sell wireless chip division

frannie
09 March 2009

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Semiconductor business NXP, which is backed by KKR, Bain Capital, Apax Partners, AlpInvest Partners and Silver Lake Partners, is understood to have sold its wireless chip services business to French smart card provider Gemalto.

NXP is fast becoming one of Europe's largest falls from grace. KKR led the EUR 8.3bn buyout of the business in late 2006, and just last week wrote down the investment by a staggering 80%, after initally writing down its stake in the middle of last year. KKR's stake is now reported to stand at 10 cents to the dollar purchase price. The company is reported to be restructuring and attempting to cut its debt burden.

In November 2006 a consortium led by KKR and backed by Silverlake Partners, Bain, Apax and AlpInvest Partners acquired an 80.1% stake in Philips' Semiconductors business, with Philips retaining the remaining 19.9%. The transaction valued the enterprise at EUR 8.3bn, consisting of the EUR 3.4bn purchasing price, EUR 4bn of debt and other liabilities and EUR 900m for Philips' remaining stake. The private equity consortium paid EUR 6.4bn to Philips for their holding.