Quantum-computing company IonQ struck a deal to buy chip maker SkyWater Technology for $35 a share, or roughly $1.8 billion, according to The Wall Street Journal.

IonQ Chairman and Chief Executive Officer Niccolo de Masi said the deal builds on enthusiasm from the Trump administration for semiconductor manufacturing and quantum-computing technology in the U.S.

“The tailwinds here are considerable,” he said. 

The details

SkyWater shareholders are set to receive $15 in cash and $20 in IonQ stock for each share of SkyWater stock, the executives said. The deal is to be announced later Monday.

It is the biggest deal yet for IonQ, which has a market value above $16 billion. SkyWater shares closed Friday at $31.32, giving the company a market value of about $1.5 billion. 

IonQ’s quantum hardware and software aims to solve problems too difficult for traditional computers across a range of industries, assisting with drug discovery and national defense, for example. It specializes in so-called trapped-ion quantum computers that have proved to offer greater accuracy.

SkyWater is an exclusively U.S.-based semiconductor foundry, serving industries including quantum computing, defense and aerospace. It doesn’t make or sell its own branded chips.

The stock portion of the SkyWater deal is subject to a collar meant to prevent big changes in the overall deal price in the event of swings in IonQ’s share price, the executives said. 

The context

IonQ’s de Masi said the deal would create a first-of-its-kind “vertically integrated quantum platform business,” allowing IonQ to speed up its manufacturing timelines and cut costs.

“This is our move to make sure we are the ‘Nvidia’ of quantum,” he said in an interview, referencing the chip giant. “And it’s not only accelerating our company, but accelerating the quantum industry for the good of our nation.” 

IonQ went public through a merger with a special-purpose acquisition company in 2021. Its shares have surged thanks to investor appetite for quantum-computing stocks. 

Tech companies from Microsoft to IBM and Alphabet have been pouring money into developing quantum computers that can process complex information.

The U.S. government has been giving priority to quantum investments, alongside artificial intelligence, as a matter of national security and in a race to stay ahead of China. The Commerce Department has started directing more funding toward these initiatives.

IonQ already does work with the U.S. government, including the Defense Department. In September, it launched a Federal division to focus efforts on the federal and defense sectors. 

SkyWater is expected to operate as a wholly owned subsidiary under its existing name after the deal closes, remaining a neutral foundry. 

SkyWater CEO Thomas Sonderman will lead the unit and report to de Masi. SkyWater will be able to offer IonQ’s products to its own customers, with the deal giving the company greater access to capital, executives said. 

This marks the latest in a string of deals for IonQ. Last year, it signed a more than $1 billion deal for the U.K. startup Oxford Ionics. It also announced deals for Lightsynq Technologies and Capella Space.