Advanced Energy Ends Acquisition Plans for XP Power

Advanced Energy Industries, a US-based semiconductor company, has decided not to pursue its acquisition of XP Power Limited, a Singapore-based electrical equipment firm. The decision follows three rejected proposals from Advanced Energy, the last of which valued XP Power at £496 million. Advanced Energy cited the inability to conduct necessary due diligence and the high expectations of value from XP Power's board as reasons for withdrawing.

XP Power had seen a 22% year-on-year decline in semiconductor revenue, but despite this, its board did not accept Advanced Energy's offer of 1,950 pence per share. Advanced Energy's decision aligns with its commitment to financial discipline, aiming for acquisitions that generate returns above its cost of capital. The company will now be prohibited from making another offer for XP Power for the next six months. Following the announcement, XP Power's shares fell by over 16%.