US takeover of Rakon deals blow to Sir Paul Callaghan’s vision and NZ’s prosperity

Monday, 18 May 2026

ANALYSIS: The late Sir Paul Callaghan once advised New Zealand to champion and develop “weird, high-tech, deeply niche” technology to underpin a more vibrant economy.

It would be hard to imagine anything more weird and deeply niche than Rakon’s crystal oscillators ‒ more on which later ‒ that have built that NZX-listed company into a worldwide business generating between $100 million and $200m in sales every year.

It’s been a great achievement for a Kiwi company and one that should bring us pride. But it won’t bring us any more money, let alone brighten our future, as it now belongs to Bourns Inc, of California.

Rakon, one of the very few local advanced manufacturing and the sole semiconductor design companies, to be listed to the New Zealand Stock Exchange, is no longer in Kiwi hands.

Read more:

• Bourns Inc launches $356m takeover bid for Rakon at $1.55 per share

• Top high-tech manufacturer Rakon gets Californian takeover offer

• Americans push out Rakon offer after falling short of 90% threshold

The sale of Rakon to Bourns for $356m will ensure the company itself thrives on the additional capital and global networks its parent offers, and long-suffering Rakon shareholders get their reward for hanging on through the company’s wild ride.

But the move, which sees Bourns hoover up all remaining shares and start the process to compulsorily acquire the company today, is a sad one for NZ Inc.

It suggests great New Zealand intellectual property will always be destined for offshore ownership, while also diminishing the scale and liquidity of the local exchange.

That in turn sets up an unfortunate cycle. Great New Zealand companies lack capital to grow, inevitably are bought for a song by large offshore players, they then number fewer on the NZX, which means fewer options for investors who want to support Kiwi enterprise, meaning a poorer exchange dominated by a few huge stocks and a lot of “penny” stocks that can’t find the right amount of capital to grow, many of whom can only return significant capital to shareholders by being bought … and so the cycle goes.

Certainly, the story was the opposite when Rakon listed in 2006. The company’s float was heavily hyped and over-subscribed ‒ just 1800 investors were lucky enough to be able to buy severely restricted parcels of shares, for which they had to pay well above the odds. Rakon shares were priced for their float based on a price-to-earnings (P/E) ratio of 23 times prospective earnings, whereas the market average at the time was about 13 times.

But it is easy to see why that happened, because the back story to Rakon was, and remains, truly compelling, putting New Zealand technology at the centre of the global GPS and mobile phone boom.

Rakon was established in Auckland in 1967 by Warren Robinson, who started manufacturing quartz crystals in his garage after delays in importing parts for his marine radio business hindered his ability to supply the local market.

Quartz crystals are critical to nearly all digital electronics; when an electric current is applied to them, they vibrate at a stable and precise frequency, creating a digital “heartbeat”. As time went on, Rakon specialised even further, creating Temperature Compensated Crystal Oscillators (TCXOs), a component that prevents a quartz crystal from drifting off-frequency when its temperature changes.

TCXOs of various types have also become omnipresent in the huge panoply of technology used around the world ‒ including in 5G networks, smartphones and tablets, GPS and satellite navigation systems, and almost everything else.

The son of Warren, Brent Robinson served as managing director and CEO of the company for 36 years and is widely credited with bringing the technological and expansionary vision. Not only did his technological nous drive the R&D side, but he also drove the company to becoming a global exporter and manufacturer, with hubs in France and India as well as New Zealand.

It is true the value of Rakon shares has never matched the company’s potential. As the New Zealand Shareholders Association (NZSA) calculated, an investment of $10,000 in Rakon at the company’s listing in 2006 would have been worth just $5500 at the point Robinson stepped down as CEO in March 2022 ‒ and the investment would have slumped to as low of just $600 at points in the 10 years preceding that.

Some of this has been down to geopolitical factors outside Rakon’s control. Enmity between the US and China was in part to blame: Rakon had once pursued Chinese customers but had to pull back ‒ and drop one of its best Chinese customers ‒ after US tech sanctions effectively scuppered takeover deals and ease of business with the US.

But the company was also blamed by some for inefficiencies and poor governance. The NZSA has tried, at various times, to remove the overt Robinson family stranglehold on the company’s decision making. In 2016 it launched a campaign to have Brent Robinson replaced as CEO and his father Warren removed from the board, citing a “dismal” commercial track record, an unwillingness to pay dividends, and “outrageous“ executive pay hikes during loss-making years.

In 2025, a battle came again, with Robinson, his family and aligned interests and the company’s largest shareholder, Singapore’s Siward Crystal Technology Co, another roughly 40% owner, pitted against the incumbent board, the NZSA and a new potential chair, respected businessman Dr Mark Bregman, over control of the board.

Robinson prevailed, becoming chair of the company and seeing an exodus of new blood from the board. The company produced a stellar first half-year result just weeks later.

Shortly after that, Bourns, a global electronic componentry firm, made its move, offering $1.55 per share for all shares in the company ‒ almost double what they were trading at, at the time, although well below what they were independently valued at.

Some believe the Bourns offer took place during a “cyclical dip” before Rakon could fully capitalise on its new AI-driven hardware growth. Other simply believe they got it for a steal. Brent Robinson turned down an offer to explain more about what had made him support a sale to The Post.

Either way, shareholders accepted the offer and received a long-awaited reward for their hitherto largely unprofitable holdings, while the business itself will likely be turbocharged by its new American owners.

But, although it makes sense from a business perspective, Sir Paul Callaghan would be disappointed in this outcome. He wanted this country to build a sturdy ecosystem of high-tech firms and as then-Science and Innovation Minister Steven Joyce said in 2012: “When a local success story is sold entirely to an offshore multinational, the strategic decision-making, high-paying corporate roles, and core IP often migrate overseas over time.

“[Sir Paul] believed that keeping these companies Kiwi-owned ensures that the wealth, advanced skillsets, and reinvestment dollars stay inside the local economy to fund the next generation of startups”.