Parthus Technologies, which makes mobile phone chips, plans to raise about $400 million (€476 million) in a share placement in the next month.
In addition to an issue of new stock, the semiconductor company's underwriter, Goldman Sachs, is likely to dispose of some of its 24 per cent shareholding in the placement.
Parthus, whose stock rose by more than 10 per cent on the London exchange yesterday, plans acquisitions in Europe and the US. Its chief operating officer, Mr Kevin Fielding, signalled this week that it had cash reserves of $135 million to fund acquisitions. The $400 placement would significantly increase this reserve, indicating that a major purchase may be imminent.
Yesterday's 30 1/2p sterling rise to 320p in heavy trading followed a 9 per cent gain on Wednesday after Parthus posted record third-quarter results and launched a new mobile computing product.
A spokeswoman said no Parthus executives were available to comment when asked yesterday about the proposed placement, which is likely to dilute its stock price initially. The Irish Times has learned, however, that the placement will proceed in the next four weeks, if not sooner.
Parthus, which was valued yesterday at £1.6 billion sterling (€2.75 billion), was worth slightly more than £765 million when floated on the London and Nasdaq exchanges last May.
The Dublin company, which has offices in San Jose, wants to strengthen its position in the third generation mobile telephony and Internet infrastructure software markets. On Wednesday, Mr Fielding said acquisition announcements would follow evaluations of some 40 firms.
Parthus claimed its new product, titled InfoStream, was the most advanced mobileInternet device on a single chip.
Co-developed with the British-based hand-held computer maker Psion, the chip would enable equipment makers to significantly reduce the time spent developing new wireless products, including phones and Internet appliances. Both Psion and the US phone maker Motorola will use the chip in their products.
Parthus will go to the market on the back of its strong performance and a resurgent interest in tech stocks on the Nasdaq.
The tech-heavy index rose by more than 6 per cent in afternoon trading yesterday after Microsoft reported earnings ahead of analysts' expectations on Wall Street.
At lunchtime in New York, Parthus shares were trading at $46 1/2, 7.8 per cent more than its closing rate on Wednesday.
The company, which makes chips required to power mobile computing and telephone devices, reported a 76 per cent rise in third quarter revenues to $8.6 million on Wednesday. Licence and royalty revenues reached $4.5 million in the quarter - 204 per cent more than in the same period last year. In the nine months to September 30th, revenues grew 64 per cent to $22.6 million.
