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Broadcom takes over AMD's digital TV biz

Posted: 27 Aug 2008 ?? ?Print Version ?Bookmark and Share

Keywords:panel processor? digital TV business? microprocessor?

Broadcom Corp. has signed a definitive agreement to acquire Advanced Micro Devices Inc.'s DTV business.

The acquisition of AMD's DTV business is expected to enable Broadcom to immediately scale its DTV business, and, in conjunction with its existing products, to offer a complete product line that covers all segments of the DTV market ranging from low-end value and mid-range quality to high-end interactive platforms and panel processors. The deal also aims to enhance and strengthen Broadcom's DTV system solution offerings while delivering the scale and focus needed to forge a market-leading DTV business.

Approximately 530 members of AMD's dedicated DTV team, in addition to certain employees directly supporting this team, located in six primary design centers around the world, will be invited to join Broadcom. AMD's DTV product line includes all Xilleon integrated DTV processors and complete turnkey reference designs, as well as NXT receiver ICs, Theater 300 DTV processor and a line of panel processors that perform advanced motion compensation, frame rate conversion and scaling.

"The acquisition of AMD's DTV business, which will become the core of Broadcom's DTV line of business, will enable us to significantly scale and accelerate the completion of our digital TV product portfolio while also expanding our tier one customer base and positions us to achieve leadership and long-term growth in this important market segment," said Daniel Marotta, senior VP and general manager of Broadcom's broadband communications group.

"AMD is executing a strategic plan to transform the company, becoming leaner and more focused while seeking to create a business model to deliver sustainable profitability," said Dirk Meyer, president and CEO of AMD. "The sale of our DTV business is a key step in AMD's transformation, helping to strengthen our balance sheet, lower our breakeven point, and hone our focus in order to take full advantage of our position as a leader in both microprocessors and graphics technology. Broadcom will be a great fit for our talented DTV employees and the DTV products they have created."

In connection with the acquisition, Broadcom will pay approximately $192.8 million in cash in exchange for AMD's DTV assets. A portion of the consideration payable to AMD will be placed into escrow pursuant to the terms of the definitive asset purchase agreement. The board of directors of each company has approved the transaction and shareholder/stockholder approval of the transaction is not required by either company. The closing, which is targeted to occur during Broadcom's Q4 ending Dec. 31, remains subject to customary closing conditions and review by relevant regulatory organizations. Broadcom may record a one-time charge for purchased in-process research and development expenses related to the acquisition in the quarter in which the transaction closes. The amount of that charge, if any, has not yet been determined.





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