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Broadcom buys MoCA startup for $31M

5/03/2007, Colleen Taylor, Contributing Editor -- Electronic News

Broadcom Corp. has signed a definitive agreement to acquire Octalica Inc., a privately held fabless semiconductor company that specializes in the design and development of networking technologies based on the Multimedia over Coax Alliance (MoCA) standard, which allows distribution of digital multimedia content throughout the home over existing coaxial cable.

Irvine, Calif.-based Broadcom said it expects to pay approximately $31 million in cash in exchange for all of the outstanding shares of Octalica's capital stock and other rights of Octalica. The boards of directors of both companies have approved the merger, and the deal's closing, which is expected to occur during Broadcom's Q2 ending June 30, remains subject to customary closing conditions.

Octalica was founded in late 2005 and is headquartered in Newton Centre, Mass., with a design team in Tel Aviv, Israel. The company consists of 27 employees overall.

In its statement today, Broadcom said that Octalica's MoCA technologies will allow the company to derive significant time to market advantages in the development of MoCA solutions for the in-home networking of multimedia content over coax. However, the connectivity technology player did not elaborate.

The MoCA standard has been growing quickly in recent months with increasing industry support. Texas Instruments Inc. joined MoCA in November 2006, bringing the total number of the group's members to 43, including 11 chip vendors. Membership in MoCA provides access to MoCA's intellectual property under reasonable and non-discriminatory licensing terms, as well as the ability to certify MoCA compliance of designs. The alliance also announced in November that it had reached one million nodes deployed by systems vendors and service providers. Products including PVR/DVR and client side set top boxes, broadband home routers, residential gateways, Ethernet to MoCA bridges and optical network terminals are currently in deployment by MoCA members, the organization said.

With this acquisition, Broadcom noted that it is adding MoCA to the other technologies for the distribution of digital content throughout the home, supplementing its Wi-Fi, Ethernet and Bluetooth products, among others.