Larsen and Toubro Shares were trading in the green and 1% higher on 9 July after the company’s wholly-owned subsidiary L&T Semiconductor Tech signed an agreement to acquire a 100% stake in SiliConch Systems for an upfront payment of Rs 133 crore. 

In its regulatory filing, the company said that the acquisition will be done with an upfront payment of Rs 133 crore, which is subject to customary closing adjustment and a deferred amount of Rs 50 crore payable over four years that is subject to achievement of certain target and other conditions. This takes the total cost of the acquisition to Rs 183 crore. 

The filing added, “The acquisition is expected to add Intellectual Property (IP), engineering skill sets and design expertise to strengthen the Group’s presence in the fabless semiconductor business, and thus aligns with the overall growth strategy of L&T Semiconductor.”

SiliConch, established in April 2016, focuses on the development and design of semiconductor Intellectual Property (IP) and Integrated Circuits (IC). As a fabless semiconductor design company, it specialises in creating system-on-chip IP and holds 30 granted patents globally.

The company primarily generates revenue through non-recurring engineering fees and licence fees. Its IP end customers include Original Equipment Manufacturers (OEMs) and fabless IC companies, mainly in the US, who use these IPs for power management systems in smartphones, automotive applications, and accessories.

At 1:21 pm, the shares of Larsen and Toubro were trading 1.02% higher at Rs 3,669 on NSE.