AUGUST 18, 2010 By Stephen Hardy -- Applied Micro Circuits Corp. (Nasdaq:AMCC) says it has entered into a definitive stock purchase agreement to acquire TPACK A/S of Copenhagen, Denmark. TPACK specializes in IP for FPGA-based optical communications designs.
AppliedMicro will pay $32 million in cash as well as up to $5 million in cash earn-outs dependent primarily upon TPACK revenues and product development milestones over the next 18 months.
TPACK has leveraged its SOFTSILICON product line of IP to support carrier-class packet and optical network equipment designs. Implemented in Altera FPGAs TPACK has targeted 10, 40 and 100 Gbps OTN switching and routing system applications. Recent products include its P-OCKET series of OTN mappers, including add/drop muxes, as well as OTN switches.
AppliedMicro, which previously has focused on ASSPs that have competed with FPGA-based products, says it plans to leverage the new assets and TPACK’s early engagement with OTN technology developers to create standard reference designs that maintain software compatibility while offering lower cost and lower power.
"While the OTN silicon market is growing rapidly, OTN standards and implementations are still evolving -- thereby offering system OEMs a broad field to uniquely differentiate their products with custom features and legacy support at various levels. This has led a large proliferation of FPGA technology within our customers' platforms. These FPGA solutions sit beside our products and together provide a scalable, system solution for our customers," said George Jones, head of marketing and business development for transport products at AppliedMicro. "TPACK's IP implemented in Altera FPGAs will provide us with the flexibility to meet our customers' special requirements and get to market quickly with leading-edge performance. We believe TPACK's team of talented engineers will make AppliedMicro more nimble and responsive to a greater range of market needs as system requirements continue to evolve and grow."
TPACK has 37 employees, including 28 design engineers. Once the acquisition is completed, the company will continue to operate from its Copenhagen office as a wholly owned subsidiary of AppliedMicro.
The stock purchase transaction is subject to customary closing conditions, and is expected to close within the next 30 days. AppliedMicro expects the deal to be profit neutral, excluding transaction costs, for the fiscal year ending March 31, 2011. It expects the transaction will be accretive subsequently.
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