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Mindspeed Technologies Inc. is a Fabless Semiconductor Company

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Mindspeed Technolgies is a fabless semiconductor company that is likely to be acquired in the near term at a substantial premium.  The company has three product segments; communication convergence processors, high-performance analog, and wireless infrastructure.

On April 30th, Mindspeed Technologies announced that they had hired Morgan Stanley to evaluate strategic alternatives.  Mindspeed Technologies is a leading global provider of network infrastructure semiconductor solutions.  They could be very valuable to a big name player.
For acquisition purposes and considering this is in an industry with a high growth outlook, I looked at Mindspeed in comparison to its peers based on Price/Sales and EV/Sales (all numbers in millions).


Based on its peers the average Price/Sales Multiple is 3.19 and the average EV/Sales multiple is 3.38. 
These multiples applied to MSPD would mean a Market Price of $450 million (north of $10/share) or an Enterprise Value of $477 million ( minus $74 million of…