Mindspeed buys Picochip for small cells push
Two base station chip suppliers join forces to chase the emerging opportunity in LTE and HetNet metrocells
Published: 6 January, 2012
READ MORE: M&A | PicoChip Designs | Infrastructure | Semiconductor | Femtocell | LTE
Continued ...
The firms calculate that their total addressable market will be worth about $3bn by 2016, now that they have a broader range of base station silicon to offer. They also see "substantial" technology and operational synergies, and opportunities for cross-selling.
In his statement, Mindspeed CEO Raouf Halim called the deal "a great strategic fit for several reasons. It enhances our competitive position as we join our respective 3G/4G technologies to offer single- and multi-mode solutions that we believe will provide us a time-to-market and product performance advantage relative to competitors."
Picochip CEO Nigel Toon, in a message to customers, said: "Picochip pioneered the concept of femtocells and small cells, and has been the clear leader in this field. However, over the last year it has become clear that this is not the environment for small companies, and we needed more resources if we were to maintain that lead and deliver on the other innovations we are working on. By joining with Mindspeed we get access to the resources of a Nasdaq-listed company, with their economies of scale and customer base. There are powerful market synergies: both companies are focused on communications infrastructure, and we share a vision for small cells and how they will transform the industry."
All Picochip's 150 employees are expected to transfer to Mindspeed. The company, which has a massively parallel approach to baseband design, has raised about $100m in venture capital over the past decade, with strategic investors including AT&T, Intel and Samsung, plus VCs including Atlas Venture, Highland Capital Partners, Pond Venture Partners, Rothschild Group and Scottish Equity Partners.
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