News

Semtech Announces Intent to Acquire Xemics

June 19, 2005 by Jeff Shepard

Semtech Corp. (Camarillo, CA), a producer of analog and mixed-signal semiconductors, announced that it would acquire Xemics SA (Switzerland), a fabless developer of ultra-low-power analog, radio frequency and digital integrated circuits. Semtech is to pay $43 million in cash to the shareholders of Xemics, and up to an additional $16 million if certain performance milestones are met within a 12-month period ending April 30, 2006. The transaction is expected to close within the next 10 days.

Semtech is making the move to bolster its power-management expertise. Xemics concentrates on integrated, battery-powered, wireless and sensing applications, applying its low-power, low-voltage design expertise to sensor interfacing/data acquisition, eight-bit RISC microcontrollers and RF transceivers, as well as audio codecs. The company employs 77 people, 56 of which are engaged in research and development.

The acquisition is to take place by Semtech International AG, Semtech's wholly owned Swiss subsidiary, with Xemics to be known as the wireless and sensing products business unit of the company. Semtech expects to generate and promote two or three new product lines from the Xemics technology over the next three or so years, with those products to contribute to top line sales and net income growth, with gross margin forecasted above 55%. Semtech also expects to gain immediate access to relatively new end markets, such as automotive, home security, industrial and medical, and double the content it offers to existing portable and communications customers.