Raspberry Pi Maker Sells For $877.7 Million - InformationWeek

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6/14/2016
02:06 PM
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Raspberry Pi Maker Sells For $877.7 Million

Premier Farnell PLC has agreed to be purchased by Daetwyler Holding AG, a Swiss supplier of electronic components, for $877.7 million.

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9 Raspberry Pi Projects For Your Summer Vacation
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One of the largest manufacturers of Raspberry Pi computers agreed to be acquired, bringing to an end the British-owned manufacture of the incredibly popular tiny computer. Premier Farnell PLC, based in Leeds, began manufacturing Raspberry Pi systems in 2012. It is being purchased for $877.7 million by Daetwyler Holding AG, a Swiss supplier of electronic components.

Premier Farnell, which was founded before World War II, had become a conglomerate, selling parts and components ranging from fire-fighting equipment to printed circuit boards. After a series of earnings warnings last year, the company began to divest non-electronic businesses, finishing the process by agreeing to be acquired by Daetwyler earlier today.

(Image: jeesoen/iStockphoto)

(Image: jeesoen/iStockphoto)

According to statements from both companies, the expectation is that the combination will allow significant operational savings as the result of combined back-office and support departments. Daetwyler, founded in 1915, is the larger company, with a current value of around $2.35 billion.

[Small projects don't require a Raspberry Pi. Read 9 Fun Embedded Projects, No Raspberry Pi Required.]

The $877.7 million price agreed to for Premier Farnell is a significant premium on the company's pre-purchase valuation. As is common in purchase situations, Premier Farnell's share price rose in trading after the agreement was announced, shooting up by nearly 50% before settling back slightly, while Daetwryler's share price dropped by around 4% in the same time.

Neither company has made a statement about the future of Raspberry Pi production, though it is unlikely that customers would see any immediate change in availability or configuration. In statements made regarding the acquisition, Daetwyler said that the purchase will strengthen its position in design engineering and maintenance. The two companies together should be in a stronger financial position, making it less likely that the market for tiny Linux-based computers will see any significant disruption.

Curtis Franklin Jr. is Senior Editor at Dark Reading. In this role he focuses on product and technology coverage for the publication. In addition he works on audio and video programming for Dark Reading and contributes to activities at Interop ITX, Black Hat, INsecurity, and ... View Full Bio
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SaneIT
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SaneIT,
User Rank: Ninja
6/20/2016 | 7:52:02 AM
Re: Passed on to consumers?
I doubt that the cost will come down, but I do see the possibility that we'll see faster delivery of updated devices.  Any time a new Pi model comes out the production runs are small, I'm hoping that what happens is the expanded capacity and efficiency means they aren't on back order the day they are released. 
moarsauce123
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moarsauce123,
User Rank: Ninja
6/18/2016 | 2:30:09 PM
Re: Making Pi(s)
Premier Farnell does more than glueing Pis together.
moarsauce123
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moarsauce123,
User Rank: Ninja
6/18/2016 | 2:28:49 PM
Re: Passed on to consumers?
Cutting cost means moving operations to low cost countries, laying off lower and middle tier employees, and increasing boni for top managers while charging higher prices for consumers claiming merger expenses. Fortunately, the sale price of Pis is not controlled by the manufacturers who are under contractual agreements with the Raspberry Pi Foundation.
Whoopty
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Whoopty,
User Rank: Ninja
6/15/2016 | 7:53:44 AM
Passed on to consumers?
I wonder how this will affect the manufacturing and pricing of Raspberry Pis going forward. If the new owners are able to cut costs, does that mean we might see some Pis that are even cheaper than before?
SaneIT
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SaneIT,
User Rank: Ninja
6/15/2016 | 7:52:53 AM
Making Pi(s)
I understand why buying Premier Farnell is attractive to any electronics manufacturer but I half expected it to be for purposes of increasing production.  They are making something right now that is popular and holding that popularity.  The standard line of "lowering operating costs" makes sense but we're talking about a company that makes an inexpensive product with very inexpensive parts.  Maybe their margins will raise a little but will they raise enough for them to be worth $877 million? 
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