Category Archives: Device Architecture

ChipMOS TECHNOLOGIES INC. and Tsinghua Unigroup Ltd. (“Tsinghua Unigroup”) today announced an agreement to form a joint-venture and to mutually terminate Tsinghua Unigroup’s earlier private placement plan.

Under the joint-venture agreement, ChipMOS TECHNOLOGIES (BVI) LTD., a wholly owned subsidiary of ChipMOS Taiwan, will sell 54.98% of the equity interests of its wholly owned subsidiary, ChipMOS TECHNOLOGIES (Shanghai) LTD., to a group led by Tsinghua Unigroup, for approximately RMB 498.4 million (approximately NT$2,437 million or US$77 million). After the consummation of such equity interest transfer, ChipMOS BVI will own 45.02% of the equity interests of ChipMOS Shanghai, Tsinghua Unigroup through its subsidiary, Tibet Unigroup Guowei Investment Co., Ltd. (“Unigroup Guowei”) will own 48%, and other strategic investors, including a limited partnership owned by ChipMOS Shanghai’s employees will own 6.98%. The investment will be used to expand the capacity of and services offered by ChipMOS Shanghai. The joint-venture agreement has been approved by the Board of Directors of ChipMOS Taiwan.

S.J. Cheng, Chairman of ChipMOS, commented, “We are pleased to reach this joint-venture agreement with Tsinghua Unigroup, which has been at the forefront of the rapidly evolving global semiconductor value chain. As a leader of the semiconductor assembly and test segment, ChipMOS will be able to leverage our extensive expertise and relationships, R&D resources and technology roadmap to meet a critical need within the Tsinghua Unigroup portfolio as it works to meet expanding domestic China market. The joint-venture will allow us accelerate the planned expansion of ChipMOS Shanghai, while adding on new lines to given the higher demand we are seeing for our LCD driver ICs, touch driver, AMOLED, OLED and memory testing, assembly and bumping services. Tsinghua Unigroup is committed to actively supporting the company across its comprehensive semiconductor supply chain investment portfolio, as we work to mutually grow the sustainable revenue and profit of ChipMOS Shanghai over the long-term, while promoting the interests of all shareholders and employees.”

Details of Joint-Venture Agreement and Termination Agreement

  1. A mutual agreement was reached between ChipMOS and Tsinghua Unigroup to terminate Tsinghua Unigroup’s participation in a planned private placement of ChipMOS Taiwan:On December 11, 2015, the Board of Directors of ChipMOS Taiwan adopted a resolution to approve a private placement of common shares in which 299,252,000 private placement shares issued by ChipMOS Taiwan would be subscribed by a controlled entity of Tsinghua Unigroup at NT$ 40 per share, and ChipMOS Taiwan and Tsinghua Unigroup entered into the Share Subscription Agreement with other transaction documents on the same date. The aforementioned private placement was subsequently approved by a resolution of ChipMOS Taiwan’s shareholders meeting on January 28, 2016, and the subscriber, Tibet MaoYeChuangXin Investment LTD., also entered into another Share Subscription Agreement and other transaction documents with ChipMOS Taiwan.All parties have agreed to mutually terminate the Share Subscription Agreement and other transaction documents. ChipMOS Taiwan held a Board meeting to terminate the aforementioned private placement, and entered into the Termination Agreement with Tsinghua Unigroup and the subscriber, respectively.
  2. Under the joint-venture agreement announced today, ChipMOS BVI, a wholly owned subsidiary of ChipMOS Taiwan, will sell 54.98% of the equity interests of its China subsidiary, ChipMOS Shanghai, to strategic investors led by Tsinghua Unigroup, and will further increase the capital of ChipMOS Shanghai with such strategic investors according to their respective shareholding ratio. The sale of the 54.98% equity interest is expected to result in a gain to ChipMOS Taiwan of approximately NT$2,288 million(approximately NT$2.67 per ChipMOS Taiwan share) upon the transaction’s close primarily due to a gain on the appreciation of fixed assets and land use rights.ChipMOS BVI, a wholly owned subsidiary of ChipMOS Taiwan, originally owned 100% of equity interests of ChipMOS Shanghai. ChipMOS and ChipMOS BVI entered into the Equity Interest Purchase Agreement and the Agreement for China-Foreign Joint Venture with each strategic investor respectively, such as Unigroup Guowei, an indirectly wholly owned subsidiary of Tsinghua Unigroup, and the limited partnership owned by ChipMOS Shanghai’s employees, selling 54.98% of equity interests of ChipMOS Shanghai at the price of around RMB 498.4 million to strategic investors including Unigroup Guowei and others, and the limited partnership owned by ChipMOS Shanghai’s employees (hereinafter collectively as “Purchasers”). After the consummation of such equity interest transfer, ChipMOS BVI will own 45.02% of equity interests of ChipMOS Shanghai, Unigroup Guowei will own 48% of equity interests of ChipMOS Shanghai, and other strategic investors and the limited partnership owned by ChipMOS Shanghai’s employees will own 6.98% of equity interests of ChipMOS Shanghai. ChipMOS BVI will increase capital to ChipMOS Shanghai, by the funds obtained from selling equity interests of ChipMOS Shanghai, with the Purchasers according to their respective shareholding ratio, and except the foregoing funds, ChipMOS BVI does not inject any additional funds to ChipMOS Shanghai. ChipMOS Shanghai is expected to gain additional cash of approximately RMB 1,074.0 million from a capital increase after the deal closes.

S.J. Cheng, Chairman of ChipMOS, added, “We have been steadily ramping production at ChipMOS Shanghai as part of a three-year capacity expansion plan, which is aligned with the increasing customer demand levels for semiconductor testing and assembly services in Mainland China and our goal of achieving sustainable profitability at ChipMOS Shanghai. Other than the US$42 millioncapital contribution invested and US$33 million bank loan facility secured formerly, the additional RMB 1,074.0 million capital contribution will help us achieve our targeted economies of scale and our long-term goals. We are also pleased as the joint-venture structure brings powerful strategic partners to ChipMOS Shanghai in a structure that will benefit all shareholders.”

SEMI, the global industry association representing more than 2,000 companies in the electronics manufacturing supply chain, today announced the hire of David Anderson as president of the SEMI Americas region.  Reporting to SEMI‘s president and CEO, the president of SEMI Americas has P&L responsibility as well as ownership of all Americas region programs and events, including SEMICON West.

David Anderson will be responsible for SEMI Americas activities in establishing industry Standards, advocacy, community development, expositions, and programs.  With broad experience in the semiconductor device industry, and leadership positions in associations, consortia, and on boards of directors, Anderson brings the diverse skills necessary to lead SEMI’s Americas region.

Anderson has past experience at Fairchild Semiconductor, National Semiconductor, the Semiconductor Industry Suppliers Association, and SEMATECH.  At SEMATECH, in addition to other industry-advancing achievements, he helped launch the global ISMI (International SEMATECH Manufacturing Initiative) effort to improve the productivity and cost performance of semiconductor manufacturing equipment and operations.

Most recently, Anderson was CEO and chairman of Novati Technologies, a specialty manufacturing fab and provider of semiconductor and related process technology development and commercialization services.  Novati’s solutions included semiconductor, MEMS, sensors, microfluidics, silicon-photonics, and novel materials. Prior to that, he held executive leadership positions for development foundries ATDF and SVTC Technologies.

“Dave’s vast experience in semiconductor equipment, as well as in a wide range of silicon devices, provides a practical understanding of the full electronics manufacturing supply chain,” said Denny McGuirk, president and CEO of SEMI.  “He has built global organizations and communities both at SEMI member companies and in SEMI partner consortia.  This will enable Dave to hit the ground running at SEMI.  Dave already has solid relationships with many of SEMI’s members in both the Americas and worldwide.  As I head toward my announced retirement, I’m confident that Dave will strengthen SEMI’s Global Executive Team and will lead the Americas organization to success in our SEMI 2020 initiative.”

Integrated circuit sales for connections to the Internet of Things are forecast to grow more than three times faster than total IC revenues during the last half of this decade, according to IC Insights’ new 2017 Integrated Circuit Market Drivers report.  ICs used to embed Internet of Things (IoT) functionality into a wide range of systems, sensors, and objects are expected to generate sales of $12.8 billion in 2016, says the new report, which becomes available this week.

Between 2015 and 2020, IoT integrated circuit sales are projected to rise by a compound annual growth rate (CAGR) of 13.3% compared to 4.3% for the entire IC market, which is projected to reach $354.7 billion in four years versus $287.1 billion last year, based on the forecast in the 492-page report.  As shown in Figure 1, strong five-year IC sales growth rates are also expected in automotive (a CAGR of 10.3%), medical electronics (a CAGR of 7.3%), digital TVs (a CAGR of 5.9%), and server computers (a CAGR of 5.4%).

Cellphone IC sales—the biggest end-use market application for integrated circuits—are expected to grow by a CAGR of 4.8% in the 2015-2020 period.  Saturation in smartphone markets and economic weakness in some developing regions are expected to curb cellphone IC market growth in the next four years after sales increased by a CAGR of 10.8% between 2010 and 2015.  Meanwhile, weak and negative IC sales growth rates are expected to continue in standard personal computers, set-top boxes, touchscreen tablets, and video game consoles.

The new 2017 IC Market Drivers report shows 2016 integrated circuit sales for IoT applications climbing nearly 19% compared to 2015 to an estimated $12.8 billion, followed by the automotive segment increasing about 12% to $22.9 billion, medical electronics rising 9% to $4.9 billion, and digital TV systems growing 4% to $12.9 billion this year.  The report estimates IC sales growth in server computers being about 3% in 2016 to $15.1 billion, cellphones being 2% to $74.2 billion, and set-top boxes being 2% to $5.7 billion.  Meanwhile, standard PC integrated circuit sales are estimated to be down 5% in 2016 to $54.6 billion while video game console IC revenues are expected to finish this year with a 4% drop to $8.9 billion and tablet IC sales are on track to decline 10% to $12.1 billion in 2016, according to IC Insights’ new report.

Figure 1

Figure 1

SiFive, the first fabless provider of customized, open-source-enabled semiconductors, today announced the availability of its Freedom Everywhere 310 (FE310) system on a chip (SoC), the industry’s first commercially available SoC based on the free and open RISC-V instruction set architecture, along with the corresponding low-cost HiFive1 software development board. As part of this availability, SiFive also has contributed the register-transfer level (RTL) code for FE310 to the open-source community, which the company revealed today at the 5th RISC-V Workshop in Mountain View, Calif.

“We started with this revolutionary concept — that instruction sets should be free and open –  and were amazed by the incredible rippling effect this has had on the semiconductor industry because it provided a viable alternative to what was previously closed and proprietary,” said Krste Asanovic, co-founder and chief architect, SiFive. “In the few short months since we’ve announced the Freedom Platforms, we’ve seen a tremendous response to our vision of customizable SoCs. The FE310 is a major step forward in the movement toward open-source and mass customization, and SiFive is excited to bring the opportunity for innovation back into the hands of system architects.”

The FE310 is the first member of the Freedom Everywhere family of customizable SoCs designed for microcontroller, embedded, IoT and wearable applications. By contributing the FE310 RTL code to the open-source community, SiFive aims to encourage open-source development of both software support for RISC-V as well as other open hardware development. The RTL code also empowers chip designers with the ability to customize their own SoC on top of the base FE310. For system architects, developers or companies without chip design capabilities, SiFive’s “chips-as-a-service” offering can customize the FE310 to meet their unique needs.

“SiFive has achieved a significant milestone for the RISC-V ecosystem,” said Rick O’Connor, executive director of the non-profit RISC-V Foundation. “We are thrilled to see the first commercial silicon based on RISC-V standards come to market and look forward to continued technology leadership from the SiFive team.”

The FE310 features SiFive’s E31 CPU Coreplex, a 32-bit RV32IMAC core running at 320+ MHz. Additional features include a 16KB L1 Instruction Cache, a 16KB Data SRAM scratchpad, hardware multiply/divide, debug module, one-time programmable non-volatile memory (OTP), flexible clock generation with on-chip oscillators and PLLs, and a wide variety of peripherals including UARTs, QSPI, PWMs and timers. Multiple power domains and a low-power standby mode ensure a variety of applications can benefit from the FE310, which was fabricated in TSMC 180nm.

The HiFive1 is an Arduino-Compatible development board featuring the FE310.

North America-based manufacturers of semiconductor equipment posted $1.49 billion in orders worldwide in October 2016 (three-month average basis) and a book-to-bill ratio of 0.91, according to the September Equipment Market Data Subscription (EMDS) Book-to-Bill Report published today by SEMI.  A book-to-bill of 0.91 means that $91 worth of orders were received for every $100 of product billed for the month.

SEMI reports that the three-month average of worldwide bookings in October 2016 was $1.49 billion. The bookings figure is 5.1 percent lower than the final September 2016 level of $1.57 billion, and is 12.2 percent higher than the October 2015 order level of $1.33 billion.

The three-month average of worldwide billings in October 2016 was $1.63 billion. The billings figure is 9.0 percent higher than the final September 2016 level of $1.49 billion, and is 19.8 percent higher than the October 2015 billings level of $1.36 billion.

“Total equipment billings increased 9 percent in October over September, while bookings contracted 5 percent,” said Denny McGuirk, president and CEO of SEMI.  “As the result, the book-to bill ratio for October dropped below parity for the first time in 11 months, even though bookings and billings activity remains at elevated levels relative to last year.”

The SEMI book-to-bill is a ratio of three-month moving averages of worldwide bookings and billings for North American-based semiconductor equipment manufacturers. Billings and bookings figures are in millions of U.S. dollars.

Billings
(3-mo. avg)

Bookings
(3-mo. avg)

Book-to-Bill

May 2016

$1,601.5

$1,750.5

1.09

June 2016

$1,715.2

$1,714.3

1.00

July 2016

$1,707.9

$1,795.4

1.05

August 2016

$1,709.0

$1,753.4

1.03

September 2016 (final)

$1,493.3

$1,567.2

1.05

October 2016 (prelim)

$1,627.5

$1,487.2

0.91

Source: SEMI (www.semi.org), November 2016

Technavio’s latest report on the global industrial embedded systems market provides an analysis on the most important trends expected to impact the market outlook from 2016-2020. Technavio defines an emerging trend as a factor that has the potential to significantly impact the market and contribute to its growth or decline.

Bharath Kanniappan, a lead analyst from Technavio, specializing in research on industrial automation sector, says, “Industrial embedded systems are widely used in both process and discrete industries. Industries such as oil and gas, power, cement, chemical, and automotive, and pulp and paper, among others, have harsh operating conditions and require robust automation systems.”

New trends such as vision systems, multi-core processors, and power efficiency capabilities have further augmented the utility and scope of the industrial embedded hardware market. The latest developments in embedded hardware are the incorporation of embedded sensors in the form of nano blobs in materials used to build industrial robots, thus enabling the machines to achieve increased conductivity and superior sensitivity. Such attributes let robots safely interact with objects and human beings in industrial environments. Such developments are an impetus to the growing embedded hardware market.

The top three emerging trends driving the global industrial embedded systems market according to Technavio automation research analysts are:

  • Increased adoption of multi-core processors
  • Rise of wireless connectivity
  • Advancement of materials used in embedded systems

Increased adoption of multi-core processors

Earlier, 8-bit microcontrollers were the most commonly used in industrial embedded systems such as motor control, industrial process control, actuators, sensors, and robotics. However, industrial technology has advanced to include complex capabilities such as wireless connectivity, imaging, and smart sensors, and this has propelled the demand for advanced and efficient algorithms. Hence, vendors are designing single chips with multiple cores to enhance applications, increase reliability, reduce power consumption, and lower overall operational costs.

“The Compact RIO industrial embedded controller from National Instruments has a dual core processor which has enabled the integration of latest technologies such as Xilinx Kintex 7 FPGAs and 64-bit Intel Atom E3800 SoC,” according to Bharath.

Rise of wireless connectivity

IoT enables prompt collection, storage, and transmission of data, which allows rapid analysis and decision making by experts across international borders. Recent developments in sensor technologies (such as wireless sensor nodes) can be integrated with wireless networking protocols like ZigBee and Wi-Fi. Previously industrial embedded systems were operating as stand-online systems. Currently, due to the high demand of IoT and wireless protocols including near field communications and long range protocols in various industries, industrial embedded systems are adopting wireless SoC architecture.

Wireless connectivity in industrial embedded systems has enabled Internet connectivity and subsequently increased the market prospects of industrial embedded systems during the forecast period.

Advancement of materials used in embedded systems

Previously sensors used in industries could collect and interpret information only at the point of contact between the sensor and the object. This is a major limiting factor in the use of industrial sensors. Hence newer materials are being developed which can incorporate multiple embedded technologies and augment the functioning of sensors. Using new composite materials such as ceramic hybrid polymers and polydimethylsiloxane, the lifespan of embedded systems remains unaffected as these materials redirect stress away from these electronic devices.

By successful incorporation of embedded systems in these materials and the use of finite-element-analysis (FEA) software, sensors can perform their function beyond the limits of the contact point by using analysis of predictive stress and strain patterns. These superior sensors can be utilized for effective and efficient predictive maintenance in various industries.

The key vendors are as follows:

  • Atmel
  • Intel
  • National Instruments
  • Infineon Technologies

About Technavio

Technavio is a leading global technology research and advisory company. The company develops over 2000 pieces of research every year, covering more than 500 technologies across 80 countries. Technavio has about 300 analysts globally who specialize in customized consulting and business research assignments across the latest leading edge technologies.

Technavio analysts employ primary as well as secondary research techniques to ascertain the size and vendor landscape in a range of markets. Analysts obtain information using a combination of bottom-up and top-down approaches, besides using in-house market modeling tools and proprietary databases. They corroborate this data with the data obtained from various market participants and stakeholders across the value chain, including vendors, service providers, distributors, re-sellers, and end-users.

 

Microsemi Corporation (Nasdaq: MSCC), a leading provider of semiconductor solutions differentiated by power, security, reliability and performance, today announced it is the first field programmable gate array (FPGA) provider to offer a comprehensive software tool chain and intellectual property (IP) core for RISC-V designs. The company’s RV32IM RISC-V core is available for Microsemi’s IGLOO™2 FPGAs, SmartFusion™2 system-on-chip (SoC) FPGAs or RTG4™ FPGAs, with an Eclipse-based SoftConsole integrated development environment (IDE) hosted on a Linux platform and the Libero SoC Design Suite providing full design support.

Microsemi’s new RV32IM RISC-V core, developed in collaboration with SiFive, enables customers to design with an open instruction set architecture (ISA), enabling complete portability and a more secure processor architecture governed by a permissive BSD license. RISC-V is a new ISA which is now a standard open architecture under the governance of the RISC-V Foundation. RISC-V offers a compelling soft processor solution for Microsemi’s low power, reliable, secure FPGAs. The RV32IM RISC-V core unleashes a new generation of innovation for embedded designers. Now engineers can rely on an open ISA, without being tied to a single vendor and leverage open source tools and hardware. Never before has a processor allowed designers to inspect, modify, adapt, collaborate and migrate their design to the best platform for their product.  Microsemi’s low power FPGAs with proven security and embedded flash are a natural fit for this new paradigm.

“Our IGLOO2, SmartFusion2 and RTG4 devices are the ideal FPGAs to build RISC-V core onto, as we offer up to 50 percent lower power consumption with proven security for customers’ IP,” said Venki Narayanan, senior director of software and systems engineering for Microsemi’s SoC Products Group. “RISC-V is a great fit for implementing clean-slate processor capabilities for security, trust and reliability which are central to Microsemi’s solutions. We will continue our leadership position in this technology by further investing in this architecture to ensure customers have long-term roadmap support.”

Customers seeking to develop customized devices can now initiate their design into a Microsemi FPGA and bring their solution to market quicker. The combination of Microsemi’s IGLOO2 FPGA, SmartFusion2 SoC FPGA or RTG4 FPGA and its Libero SoC Design Suite create an ideal platform to target a RISC-V core for many embedded applications and is easy to implement with regard to size and power. The lower power and security of Microsemi’s FPGA families provides a sound architecture for customers seeking to protect their IP and ensure long-term support for their designs in the industrial, defense, security and medical markets. The Libero SoC Design Suite allows designers to implement their designs and efficiently pack the FPGA logic elements (LEs), yielding a cost-effective solution. The Eclipse-based SoftConsole IDE running on Linux allows users to compile and debug their source code. The IP core and software platforms are the first comprehensive RISC-V solution for FPGAs.

The new RV32IM RISC-V core is especially compelling for applications such as safety and security, as the register transfer level (RTL) source code is available for inspection. For example, customers can verify the security of the processor themselves, which is not possible with other processors, as they have closed architectures. In safety-critical applications, as customers can run multiple RISC-V cores to ensure if one fails there is a redundant core to take over.

“We are very excited Microsemi is releasing a RISC-V intellectual property core for its IGLOO2, SmartFusion2 and RTG4 FPGAs,” said Rick O’Connor, executive director of the RISC-V Foundation. “The complete Linux-based toolchain that the company is providing will enable a broad range of customers to develop RISC-V cores in Microsemi FPGAs. I applaud Microsemi’s leadership in introducing this comprehensive RISC-V platform and the foundation looks forward to working with the company to explore future advancements.”

Through Microsemi’s early involvement in the creation of the RISC-V Foundation, the company has an established leadership role in the emerging standard and ecosystem and is working closely with the nonprofit to ensure the ISA becomes an industry standard for a wide variety of computing devices. Ted Speers, head of product architecture and planning for Microsemi’s SoC business unit, was appointed to the inaugural board of directors of the RISC-V Foundation in July 2016, and Ted Marena, director of SoC FPGA marketing, was recently elected as vice-chair of the RISC-V Marketing Committee.

Product Availability

Microsemi’s comprehensive software and IP core for RISC-V designs is available now. For more information, visit http://www.microsemi.com/products/fpga-soc/soc-processors/risc-v or contact [email protected].

About Microsemi’s IGLOO2 FPGAs and SmartFusion2 SoC FPGAs

Microsemi’s IGLOO2 FPGAs and SmartFusion2 SoC FPGAs deliver more resources in low density devices, with the lowest power, proven security and exceptional reliability. The devices offer 30-50 percent more power efficiency and are ideal for general purpose functions such as Gigabit Ethernet or dual PCI Express control planes, bridging functions, input/output (I/O) expansion and conversion, video/image processing, system management and secure connectivity. Microsemi FPGAs and SoC FPGAs are used by customers in in communications, industrial, medical, defense and aviation markets. PCIe Gen 2 connectivity starts at just 10K LEs. SmartFusion2 SoC FPGAs offer a 166MHz ARM Cortex-M3 processor with up to 512KB of embedded flash and a complete peripheral set. IGLOO2 FPGAs offer a high performance memory subsystem with up to 512KB embedded flash, 2 x 32 KB embedded static random-access memory (SRAM), two direct memory access (DMA) engines and two double date rate (DDR) controllers. Microsemi also offers a broad range of military, automotive and space grade FPGAs and SoC FPGAs. For more information visit: http://www.microsemi.com/products/fpga-soc/soc-fpga/smartfusion2 and http://www.microsemi.com/products/fpga-soc/fpga/igloo2-fpga.

About Microsemi’s RTG4 FPGAs

RTG4 FPGAs bring new capabilities to the market and combine a wealth of features with the highest quality and reliability to meet the increasing demands of modern satellite payloads. The devices feature reprogrammable flash configuration, making prototyping easier for customers. RTG4’s reprogrammable flash technology offers complete immunity to radiation-induced configuration upsets in the harshest radiation environments, without the configuration scrubbing required with SRAM FPGA technology. RTG4 supports space applications requiring up to 150,000 logic elements and up to 300 MHz of system performance. RTG4 is Microsemi’s latest development in a long history of radiation-tolerant FPGAs that are found in many NASA and international space programs. For more information, visit http://www.microsemi.com/products/fpga-soc/radtolerant-fpgas/rtg4.

About Microsemi

Microsemi Corporation (Nasdaq: MSCC) offers a comprehensive portfolio of semiconductor and system solutions for aerospace & defense, communications, data center and industrial markets. Products include high-performance and radiation-hardened analog mixed-signal integrated circuits, FPGAs, SoCs and ASICs; power management products; timing and synchronization devices and precise time solutions, setting the world’s standard for time; voice processing devices; RF solutions; discrete components; enterprise storage and communication solutions, security technologies and scalable anti-tamper products; Ethernet solutions; Power-over-Ethernet ICs and midspans; as well as custom design capabilities and services. Microsemi is headquartered in Aliso Viejo, California and has approximately 4,800 employees globally. Learn more at www.microsemi.com.

Microsemi and the Microsemi logo are registered trademarks or service marks of Microsemi Corporation and/or its affiliates. Third-party trademarks and service marks mentioned herein are the property of their respective owners.

 

MACOM Technology Solutions Holdings, Inc. (NASDAQ: MTSI) (“MACOM”), a leading supplier of high-performance analog RF, microwave, millimeterwave and photonic semiconductor products, today announced it has entered into a definitive agreement to acquire Applied Micro Circuits Corporation (NASDAQ:AMCC) (“AppliedMicro”), a global leader in Connectivity and Computing solutions for next-generation cloud infrastructure and Data Centers, for approximately $8.36 per share, consisting of $3.25 in cash and 0.1089 MACOM shares per share of AppliedMicro. This price for each share of AppliedMicro represented a 15.4% premium over the company’s closing price of $7.25 on Friday, November 18th. MACOM intends to divest the well-positioned but non-strategic Compute business within the first 100 days of closing.

Transaction Highlights Include:

  • Transaction valued at approximately $770 million for AppliedMicro’s approximately $165 million in TTM revenue (including the Compute business) and $82 million of cash and short-term investments at September 30, 2016
  • MACOM and AppliedMicro’s pro forma combined TTM revenue was approximately $709 million including AppliedMicro’s Compute business, or approximately $644 million excluding the Compute business
  • AppliedMicro’s Connectivity business is highly complementary to MACOM’s product portfolio, through the addition of market-leading OTN framers, MACsec Ethernet networking components and the industry’s leading single-lambda PAM4 platform
  • Transaction to accelerate MACOM’s significant growth in optical technologies for Cloud Service Providers and Enterprise Network customers serving the high-growth, high-margin Data Center market
  • AppliedMicro’s leadership PAM4 solutions based on FinFET technology and custom engagements with top-tier Data Center and service provider customers is expected to strengthen MACOM’s competitive position with those customers
  • MACOM expects to improve the profitability of AppliedMicro by divesting the Compute business and by delivering on substantial revenue and cost synergies
  • Excluding the Compute business, MACOM expects this transaction to be accretive to its non-GAAP gross margin, non-GAAP operating margin and non-GAAP EPS, in MACOM’s fiscal year ending September, 2017
  • MACOM to benefit from over $600 million of tax net operating loss carry forwards

Commenting on the transaction, John Croteau, President and Chief Executive Officer, stated, “This transaction will accelerate and expand MACOM’s breakout opportunity in Enterprise and Cloud Data Centers. MACOM will now be able to provide all the requisite semiconductor content for optical networks – analog, photonic and PHY – from the switch to fiber for long haul, metro, access, backhaul and Data Center. AppliedMicro’s 100G to 400G single-lambda PAM4 platform should perfectly complement MACOM’s leadership in analog and photonic components for Data Centers.

“Notably, the IEEE recently recommended the adoption of AppliedMicro’s single lambda PAM4 solution to be an industry standard for enterprise and Data Center connectivity, positioning this technology as the solution of choice going forward. Additionally, AppliedMicro’s Connectivity business aligns well with MACOM’s differentiated, high-growth business model, offering non-GAAP gross margins well in excess of MACOM’s long term target operating model, long product life cycles, and sticky customer relationships.”

“AppliedMicro also provides value-added technologies including SerDes, high speed analog-to-digital and digital-to-analog converters with industry-leading engineering competencies and long product lifecycles. Importantly, we expect that this transaction will establish MACOM with an incumbent position supplying strategic components and enterprise and cloud Data Center customers.”

MACOM intends to divest AppliedMicro’s well-positioned Compute business within 100 days from closing the transaction, as the business does not strategically align with MACOM’s long-term focus. AppliedMicro has been exploring strategic options for the Compute business and there is known strategic interest among several potential buyers and investors. MACOM will continue to support Compute customers and partners during this transition.

“This is an exciting day for AppliedMicro, and we are pleased to be joining forces with MACOM. The transaction affirms the value that our employees have created and provides a strong path forward for our Connectivity business while delivering AppliedMicro stockholders a robust premium,” said Paramesh Gopi, President and CEO, AppliedMicro. “This transaction will create an industry powerhouse with the scale, deep customer relationships, innovative technology, and enabling products that will help deliver explosive growth in Enterprise and Cloud Data Centers. In addition, this agreement provides a promising path forward for the Compute business, which is in the process of bringing AppliedMicro’s highly-competitive third-generation X-Gene processor to market. X-Gene is well-positioned to address the large opportunity for mainstream server processors with its proven high performance cores, scalable interconnect and high per socket memory capabilities.”

MACOM intends to commence a tender offer to purchase each outstanding common share of AppliedMicro for approximately $8.36 per share, consisting of $3.25 in cash and 0.1089 MACOM shares per share of AppliedMicro. MACOM will assume certain equity awards held by AppliedMicro employees. The transaction value is approximately $770 million in diluted equity value, or approximately $688 million net of AppliedMicro’s cash position of approximately $82 million as of September 30, 2016. The transaction is expected to be accretive to MACOM’s non-GAAP gross margin, non-GAAP operating margin and non-GAAP EPS in fiscal year 2017, excluding the Compute business. AppliedMicro stockholders are expected to own approximately 15% of the combined company on a pro forma basis. MACOM expects to pay the cash portion of the acquisition price from cash on hand. The boards of directors of both companies have approved the transaction, which is subject to customary closing conditions and regulatory approvals. MACOM currently expects the transaction to close in the first calendar quarter of 2017.

Evercore is acting as exclusive financial advisor and Ropes & Gray LLP is serving as legal counsel to MACOM.

Morgan Stanley & Co. LLC is acting as exclusive financial advisor and Pillsbury Winthrop Shaw Pittman LLP is serving as legal counsel to AppliedMicro. The board of directors of AppliedMicro received a fairness opinion from Morgan Stanley & Co. LLC and Needham & Company, LLC.

Conference Call and Slide Presentation Information

MACOM will host a conference call on Monday, November 21 at 9:00 a.m. Eastern Time (6:00 a.m. Pacific Time). The conference call will be broadcast live over the Internet with a slide presentation and can be accessed by all interested parties on the Investor section of MACOM’s website at http://ir.macomtech.com/. On the call will be John Croteau, MACOM’s President and Chief Executive Officer, and Robert McMullan, MACOM’s Chief Financial Officer. Investors and analysts are invited to participate on the call. To listen to the live call, please go to the Investor section of MACOM’s website and click on the Conference Call link at least fifteen minutes prior to the start of the call to register, download, and install any necessary audio software.

When: Monday, November 21, 2016
Time: 9:00 a.m. Eastern Time
Dial in: 1+(877) 837-3908; outside the U.S. 1+(973) 872-3000
Participant Code: 24085998
Live Webcast: http://ir.macom.com/events.cfm

For those unable to participate during the live broadcast, a replay will be available shortly after the call and will be available on MACOM’s website for 7 days. The replay dial-in number is 1-(855) 859-2056 and the pass code is 24085998. International callers should dial +1(404) 537-3406 and enter the same pass code at the prompt. Additionally, the conference call will be broadcast live over the Internet and can be accessed by all interested parties for approximately 60 days in the Investor Relations section of the Company’s website at http://ir.macomtech.com/.

Further details of the transaction are set out in MACOM’s Current Report on Form 8-K filed with the Securities and Exchange Commission on November 21, 2016.

About MACOM

MACOM enables a better-connected and safer world by delivering breakthrough semiconductor technologies for optical, wireless and satellite networks that satisfy society’s insatiable demand for information.

Today, MACOM powers the infrastructure that millions of lives and livelihoods depend on every minute to communicate, transact business, travel, stay informed, and be entertained. Our technology increases the speed and coverage of the mobile Internet and enables fiber optic networks to carry previously unimaginable volumes of traffic to businesses, homes, and datacenters.

Keeping us all safe, MACOM technology enables next-generation radars for air traffic control and weather forecasting, as well as mission success on the modern networked battlefield.

MACOM is the partner of choice to the world’s leading communications infrastructure, aerospace and defense companies, helping solve their most complex challenges in areas including network capacity, signal coverage, energy efficiency, and field reliability, through its best-in-class team and broad portfolio of analog RF, microwave, millimeterwave, and photonic semiconductor products.

MACOM is a pillar of the semiconductor industry, thriving for more than 60 years of daring to change the world for the better, through bold technological strokes that deliver true competitive advantage to customers and superior value to investors.

Headquartered in Lowell, Massachusetts, MACOM is certified to the ISO9001 international quality standard and ISO14001 environmental management standard. MACOM has design centers and sales offices throughout North America, Europe, Asia and Australia.

MACOM, M/A-COM, M/A-COM Technology Solutions, M/A-COM Tech, Partners in RF & Microwave, and related logos are trademarks of MACOM. All other trademarks are the property of their respective owners. For more information about MACOM, please visit www.macom.com.

About AppliedMicro

AppliedMicro Circuits Corporation (Nasdaq:AMCC) is a global leader in computing and connectivity solutions for next-generation cloud infrastructure and data centers. AppliedMicro delivers silicon solutions that dramatically lower total cost of ownership. Corporate headquarters are located in Santa Clara, California. www.apm.com.

Electronics manufacturing executives will examine growth prospects, global industry developments and technology strategy at the SEMI Industry Strategy Symposium (ISS) 2017 to be held January 8-11 at the Ritz-Carlton, Half Moon Bay.  ISS 2017, designed as the year’s earliest indicator of emerging trends, provides critical perspective and market insight to executives responsible for corporate strategy and key relationships in the electronics manufacturing supply chain. The annual symposium brings together leading analysts, researchers, economists, and technologists to provide fresh insights on the forces shaping the semiconductor industry. The elite event offers insight into new growth opportunities, potential partners, and vital intelligence to help navigate the industry’s rapidly changing playing field.

ISS 2017 highlights include:

  • Market Perspective: Where’s the growth? Hear what experts are saying at Google, IBM Research, and the Consumer Technology Association.
  • Economic Trends: Will an expanding Internet of Things (IoT) ecosystem drive demand for investments in cloud storage, security, and new devices? Get insider perspectives from Gartner, Linx Consulting, and VLSI Research.
  • Technology: Will EUV lithography finally arrive, or will the industry double-down on multiple patterning? Get insights from executives at imec, SanDisk, Applied Materials, and more.
  • Global Forces: Consolidation and China’s will to establish a homegrown semiconductor supply chain are redrawing the map. Hear from Philips Healthcare, International Business Strategies, and McKinsey & Co.

Plus, powerful first-of-the-year keynotes by:

  • GLOBALFOUNDRIES─ Gary Patton, CTO and senior VP of Worldwide R&D
  • Intel─ Diane Bryant, executive VP and GM of the Data Center Group
  • Applied Materials ─Om Nalamasu, CTO
  • Philips Healthcare─ Diego Olego, senior VP and Chief Strategy & Innovation Officer

The challenges are many, the investments enormous, and the pressure to show profitability and growth is greater than ever. SEMI ISS 2017 will give industry professionals the perspective needed to succeed in today’s turbulent business climate. To learn more and to register, visit www.semi.org/en/ISS.

Celebrating its 30th anniversary, the largest-ever SEMICON Korea will be held from February 8 to 10, featuring 600 exhibiting companies and an expected 40,000 attendees at COEX, Seoul. SEMICON Korea 2017 is the bellwether event for advanced memory, electronics manufacturing, and breaking technology developments, deep technical forums, business programs and Standards activities.

Each year, companies exhibit at SEMICON Korea ─ to the full capacity of the COEX facility ─ to connect with customers and decision makers, demonstrate product and technology leadership and expand their brand.

On opening day (February 8) of SEMICON Korea, three industry thought leaders will keynote on the future of the global semiconductor industry:

SEMICON_Korea_2017

The exposition includes valuable specific technical networking and business programs that are always very popular as they give insight into the full Korea electronics manufacturing ecosystem.

  • Supplier Search – featuring the world’s leading materials manufacturers
  • OEM Supplier Search – facilitating business cooperation between global suppliers and Korea’s parts manufacturers
  • Presidents Reception – an exclusive VIP networking event with more than 450 global industry leaders, that have been contributing to the growth of the Korea semiconductor industry for over 30 years.

SEMICON Korea 2017 is the leading semiconductor technology event in Korea. Major programs include: Smart Manufacturing Forum, SEMI Technology Symposium, System LSI Forum, Metrology and Inspection Forum, Test Forum, Market Seminar and more. The event is an opportunity to meet and learn from more 100 global experts. A complete schedule of the program is available here:
www.semiconkorea.org/en/attend/program-sessions

New this year, 32 companies will showcase their innovations in the new LED Pavilion at SEMICON Korea 2017, an opportunity to meet the entire LED supply chain.

Complimentary registration for SEMICON Korea 2017, which includes access to the exhibition hall and keynote attendance, opens tomorrow, November 16 (www.semiconkorea.org/en/attend/registration) and closes on February 1, 2017.