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Electronics Production | March 22, 2011

NetLogic to acquire Optichron

NetLogic Microsystems 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 /USA)

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 next-generation base stations by multiple original equipment manufacturers (OEMs), and NetLogic Microsystems expects that the acquisition will accelerate Optichron’s product roadmaps in the advanced 40nm process node and beyond. “Our combination with Optichron further solidifies our commitment to, and our increasing R&D investments in, the communications infrastructure market. 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,” said Ron Jankov, president and CEO at NetLogic Microsystems. “As a clear technology and market leader in DFE processing, Optichron shares strong customer synergies in the 3G/4G mobile infrastructure with NetLogic Microsystems, and the combined company will have one of the most compelling and comprehensive product portfolios for next-generation base stations,” said Roy Batruni, co-founder and CTO of Optichron. In connection with the acquisition, NetLogic Microsystems will pay the Optichron stockholders initial cash consideration of approximately USD 77 million upon the closing of the transaction. NetLogic Microsystems will assume approximately USD 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 USD 108.5 million would be payable by March 31, 2013, and, an additional consideration of USD 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.
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