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Agilent semi group spins out as Avago

Posted: 05 Dec 2005 ?? ?Print Version ?Bookmark and Share

Keywords:Agilent Technologies? semiconductor? Avago Technologies? Kohlberg Kravis Roberts? Silver Lake Partners?

Agilent Technologies Inc.'s former semiconductor products group became a standalone company lat last week (Dec. 1), under the name Avago Technologies Inc.

Since Kohlberg Kravis Roberts & Co. and Silver Lake Partners offered $2.66 billion to acquire the group in August, Avago agreed to sell its I/O solutions division to PMC-Sierra Inc. for $425 million.

Avago chief executive Dick Chang said that the standalone company wants to carve its expertise in hybrid, analog and mixed-signal circuits, where Avago has a loyal customer base stemming back to the pre-1999 period when it was a division of HP.

Avago's CMOS business traditionally has been in image sensors, though it has a formerly captive CMOS mixed-signal ASIC business that moved into competitive accounts after the division moved to Agilent in 1999. That ASIC business has captured some key external customers like Cisco Systems Inc. in recent years, and Chang said the company has every intention of continuing to grow the CMOS ASIC business.

The unit that became Avago saw a slight dip in revenues and profits in fiscal 2005 (net revenue of the unit was $1.8 billion in 2005, down from approximately $2 billion in 2004), which Chang said was due in part to OEM inventory buildup in early 2004 that led to corrections in component supply in late 2004 and early 2005.

Jeff Henderson, Avago's SVP of worldwide sales and marketing, said that Avago expects growth in virtually all market sectors in fiscal 2006, particularly in wireless handsets, where Avago can leverage proprietary technologies such as GaAs-based power amps and film bulk acostic resonator filters, using a unique MEMS-based thin film.

Avago's sales currently are 36 percent in enterprise IT and data processing, with significant sectors in printer ASICs and optical mouse control; 34 percent in communications, split almost evenly between wireless (RF and microwave) and wireline (largely optical); 19 percent in military/industrial/automotive; and 11 percent in consumer electronics.

- Loring Wirbel
EE Times

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