Broadcom buys Octalica for $31 million

SOURCE: EETimes
http://www.eetimes.com/showArticle.jhtml?articleID=199203515
5/03/2007, Mark LaPedus

SAN JOSE, Calif. � Broadcom Corp. has signed a definitive agreement to acquire Octalica Inc. for $31 million in cash.

Octalica (Newton Centre, Mass.) is a privately-held fabless semiconductor company that specializes in the design and development of networking technologies based on the MoCA (Multimedia over Coax Alliance) standard.

This enables distribution of digital multimedia content throughout the home over existing coaxial cable. MoCA has emerged as a method for in-home multimedia distribution among cable, satellite and telecommunications service providers in the U.S.

With this acquisition, Broadcom (Irvine, Calif.) is adding MoCA technology to its portfolio. It is supplementing the other technologies it offers to address end users' connectivity needs, including Wi-Fi, Ethernet, and Bluetooth products, among others.

Octalica has 27 employees. In connection with the acquisition, Broadcom 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.

A portion of the consideration payable to the stockholders of Octalica will be placed into escrow pursuant to the terms of the acquisition agreement. The boards of directors of both companies have approved the merger.

The closing, which is expected to occur during Broadcom's second quarter ending June 30, remains subject to customary closing conditions. Broadcom may record a one-time charge for purchased in-process research and development expenses related to the acquisition in the second quarter. The amount of that charge, if any, has not yet been determined.