NetLogic Microsystems to Acquire Optichron

Wireless News
03-24-2011
NetLogic Microsystems to Acquire Optichron
Type: News

NetLogic Microsystems, a provider of intelligent semiconductor solutions for Internet networks, announced that it has signed a definitive agreement to acquire Optichron, a privately-held, fabless semiconductor provider of 3G/4G LTE base station digital front-end (DFE) processors, located in Fremont, California.

Optichron's DFE technology enables signal bandwidth, spectrum maximization and power efficiency for LTE deployments requiring the highest data rates and lowest power consumption.
The acquisition of Optichron will expand and broaden NetLogic Microsystems' footprint in 3G/4G LTE base stations by complementing NetLogic Microsystems' portfolio of multi-core processors, knowledge- based processors and 10 Gigabit Ethernet PHY solutions. Optichron's DFE processors have been designed into base stations by multiple original equipment manufacturers (OEMs), and NetLogic Microsystems expects that the acquisition will accelerate Optichron's technical leadership and product roadmaps in the 40nm process node and beyond.

The exponential growth in mobile data traffic in the next five years, coupled with global spectrum scarcity, are forcing service providers and operators worldwide to push the limits on capacity and throughput for their limited spectrum. This is in turn driving a need for next-generation base stations that can support wider bandwidth, significantly more signal channels and more protocols (2G/ 3G/4G) in each band. Conventional DFE processing solutions typically support narrow bandwidths, a limited number of channels and a single protocol per signal band, and are therefore costly and inefficient for high-throughput base stations.

"Our combination with Optichron further solidifies our commitment to, and our increasing R&D investments in, the communications infrastructure market," said Ron Jankov, president and chief executive officer at NetLogic Microsystems. "DFE processors are an increasingly critical element of next-generation 3G/4G LTE common- platform base stations, and the combination of NetLogic Microsystems and Optichron further strengthens our technical leadership in this very exciting market."

In connection with the acquisition, NetLogic Microsystems will pay the Optichron stockholders initial cash consideration of approximately $77 million upon the closing of the transaction. NetLogic Microsystems will assume approximately $22 million of restricted stock units for employees of Optichron who join NetLogic Microsystems following the close of the acquisition. In addition, NetLogic Microsystems will pay the Optichron stockholders an earn- out upon the attainment of performance milestones through 2012 for the acquired business. If the maximum earn-out is achieved, an additional cash consideration of approximately $108.5 million would be payable by March 31, 2013, and, an additional consideration of $12.5 million would be paid in shares of NetLogic Microsystems common stock (valued approximately at closing date value), issued only to several Optichron employees, subject to their continued employment after the acquisition. The acquisition has been approved by both companies' board of directors, is expected to close in the second quarter of 2011 and remains subject to customary closing conditions.

((Comments on this story may be sent to newsdesk@closeupmedia.com))

Copyright 2011 Close-Up Media, Inc. All Rights Reserved.
n/a