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Cavium acquires Linux expert for $50M

Posted: 18 Nov 2009 ?? ?Print Version ?Bookmark and Share

Keywords:embedded? Cavium Montavista deal? Linux? processor?

Cavium Networks has signed a definitive agreement to acquire MontaVista Software. The transcation is valued at $50 million, comprised of approximately $16 million in cash and approximately $34 million in Cavium Networks common stock. The deal is expected to close in December.

Embedded Linux is becoming the OS of choice for hundreds of millions of devices ranging from very large carrier grade equipment to consumer electronics. Traditionally embedded devices used a proprietary OS or commercial RTOS. However, there is a major trend towards using embedded Linux. This rapid adoption of Linux in embedded networking, wireless, CE, mobile devices and storage is driving the demand for a high-quality, commercial-grade embedded Linux along with support for multicore processors and embedded virtualization. MontaVista offers multicore embedded Linux OS, virtualization, development tools and professional services with many tier one customers. The first commercial embedded Linux vendor, MontaVista provides the Carrier Grade Linux that has been widely adopted by industry leading companies that include Alcatel-Lucent, Cisco, Ericsson, Fujitsu, NEC, Nokia-Siemens, NTT, Motorola, Samsung and others. MontaVista is also deploys in CE manufacturers such as Sony, Samsung and Philips; MID and mobile vendors such as NEC and Garmin; industrial automation vendors such as Hewlett-Packard, Kyocera-Mita and Fuji Xerox and leading automotive infotainment suppliers. One of MontaVista's signature, high profile deployments includes Dell's latest innovative enterprise notebook the Dell Latitude ON that uses MontaVista's Montabello software platform.

"Software is becoming an increasingly important part of the total solution with the rapidly increasing adoption of multi-core processors," said Syed Ali, president and CEO of Cavium Networks. "This acquisition will complement Cavium's market leading processor portfolio with world-class software expertise and will enable us to deliver highly compelling and differentiated solutions to the market."

"Embedded Linux is poised for rapid growth," said Rusty Harris, president and CEO, MontaVista Software. "By becoming part of Cavium Networks, MontaVista can confidently continue to offer industry leading commercial grade embedded Linux, support and services to our customers and partners."

Running separately
After the acquisition, MontaVista will run as a separate operating unit and will retain the MontaVista brand name. In addition, Cavium Networks will continue the MontaVista business model and support embedded Linux on multiple architectures from multiple processor vendors. MontaVista will maintain its own dedicated and focused engineering, sales and product management staff. MontaVista's customers and partners will see no change in customer facing field operations and the web-based support and product download sites will be maintained.

"MontaVista is a leader in embedded Linux support and is a key software partner in the ARM ecosystem," said Warren East, CEO, ARM. "We believe as part of Cavium Networks, an existing ARM Partner, MontaVista will continue to deliver innovative Linux solutions optimized for current and future energy-efficient ARM processors and the range of silicon platforms which are based on them. This strategy is closely aligned with ARM's approach of enabling a broad ecosystem with the flexibility and choice needed to fuel differentiated market solutions across a range of application areas."

"MontaVista and MIPS have been close partners since 2001," said John Bourgoin, president and CEO of MIPS Technologies. "The combination of Cavium Networks and MontaVista is extremely promising for the continued availability of commercial and carrier grade Linux on the industry leading MIPS-based processors. We look forward to working together to enable the availability of MontaVista Linux on all licensed MIPS cores."

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