LONDON: IQE plc, a global supplier of compound semiconductor wafer products, announced Tuesday a strategic investment from MACOM Technology Solutions Inc. and other existing shareholders, raising approximately £81 million in gross cash proceeds.
The fundraising includes a £30 million subscription by MACOM for 151,515,151 new ordinary shares at 19.8 pence per share, along with £15 million in secured zero-coupon convertible loan notes from MACOM. Existing noteholders are reinvesting approximately £22.8 million, while a placing and retail offer are expected to raise £11 million and up to £2 million, respectively.
MACOM, a global semiconductor manufacturer and existing customer of IQE, will be entitled to appoint two non-executive directors to IQE’s board following the investment.
“This proposed transaction is transformational for IQE,” said Jutta Meier, CEO of IQE. “The investment from MACOM and other existing shareholders will provide the balance sheet strength to allow us to capitalise on the opportunities in front of us, while maintaining our unique global footprint.”
Proceeds will be used to repay existing bank debt, redeem existing convertible loan notes issued in March 2025, and strengthen the balance sheet. IQE said it is ending its strategic review as a result of the transaction and is no longer considered to be in an “offer period” under the City Code on Takeovers and Mergers.
The fundraising is conditional on shareholder approval at a general meeting scheduled for May 15, 2026, as well as clearance under the National Security and Investment Act 2021 and Italian foreign direct investment legislation. No part of the fundraising is underwritten.
Mark Cubitt, chair of IQE, called the outcome “a fantastic result for all stakeholders,” adding that the fundraise “removes debt pressures.”
Stephen Daly, CEO of MACOM, said the transaction “will allow IQE to realize its full potential in technology, operational execution and financial performance.”
The issue price of 19.8 pence per share represents a discount of approximately 58.4% to the closing mid-market price of 47.6 pence on April 24, the latest practicable date before the announcement.
Editor’s note: The steep 58.4% discount to the recent trading price raises questions about the terms’ favorability to existing minority shareholders, though IQE’s board argues the deal is necessary to eliminate debt and fund growth in critical technologies like indium phosphide and gallium nitride. Shareholders face a binary choice: approve the resolution or risk the company seeking alternative funding under potentially worse conditions.