Australian tech darling Altium lands $9 billion takeover bid from Japan

Japanese chipmaker Renesas has lobbed a $9.1 billion offer for Australian software maker Altium, a deal expected to go through after it was unanimously supported by Altium’s board.

Renesas on Thursday said it would acquire a 100 per cent stake in the ASX-listed software firm for $68.50 per share, a 33 per cent premium on the stock’s last closing price and 30 per cent above its all-time closing high.

Altium’s shares soared on the news, trading 28.5 per cent higher at $65.84 in afternoon trade in Sydney.

Altium chief executive Aram Mirkazemi will continue to lead the company as a subsidiary of Renesas.Credit: Ben Rushton

“The acquisition enables two industry leaders to join forces and establish an integrated and open electronics system design and lifecycle management platform that allows for collaboration across component, subsystem, and system-level design,” Renesas said in a statement.

Altium, which is headquartered in San Diego, is involved in the development and sale of computer software for the design of electronic products. Its technology helps power a host of electronic devices from smartphones to aeroplanes.

Under the arrangements of the deal, chief executive Aram Mirkazemi will continue to lead the company as a subsidiary of Renesas.

“I strongly believe that electronics is the single most critical industry to building a smart and sustainable world,” he said in a statement to the ASX backing the deal.

“Renesas’s visionary leadership and commitment to making electronics accessible to all resonates strongly with Altium. ... Having worked closely with Renesas as a partner for nearly two years, we are excited to be part of the Renesas team as we continue to successfully execute and grow.”

Altium chairman Sam Weiss also endorsed the proposed deal, which he called a “compelling” offer for investors. It comes two years after US design software giant Autodesk walked away from a mooted $5 billion bid.

Weiss told this masthead the Altium takeover should not be viewed as a loss for the ASX.

“The way I like to think about it is that it’s a demonstration that the ASX is a good home for technology companies,” he said. “This company has spent 25 years listed in Australia, most of that time run from somewhere else. And throughout that time really less than 2 per cent of our revenue comes from Australia.

“I would hope that it encourages other companies to go to the ASX because it has some real benefits. There is a pool of capital in Australia that is quite large, and you can access it through the ASX, so I hope it encourages people to knock on the door.”

Altium was previously one of the so-called “WAAAX” stocks – a set of ASX-listed tech companies that rode a wave of investor demand, particularly during the COVID-19 pandemic. Its siblings in the cohort included Afterpay, WiseTech Global, Xero and Appen.

Shares in each of the companies slipped after the pandemic amid rising interest rates and subdued demand for software, though shares in Altium are now trading at all-time highs.

“This is clearly a positive development for the Altium share price,” E&P Capital’s analyst Paul Mason said.

“Given unanimous support from the board, as well as the large premium to prior close, we would expect the transaction to be supported and go through.”

The Business Briefing newsletter delivers major stories, exclusive coverage and expert opinion. Sign up to get it every weekday morning.