Company announces broadband acquisition

Conexant's strengths in broadcast operator set-top box (STB) solutions complement NXP's terrestrial IP and retail STB and digital TV products.

NXP Semiconductors has announced that it will acquire the broadband media processing (BMP) business of Conexant Systems.

NXP's existing set-top box and digital TV operations will be combined with Conexant's BMP business.

The combined operations will create a top three player in digital video systems with the scale to establish a strong leadership position.

The deal represents NXP's fourth acquisition since independence and is the first for its home business unit.

Conexant's BMP business accounted for US $205 million in revenue in 2007.

NXP will pay Conexant US $110 million in cash up front and additional consideration of up to US $35 million based on achievement of certain revenue milestones over the period from closing through 2009.

Conexant's strengths in broadcast operator set-top box (STB) solutions are complementary to NXP's terrestrial IP and retail STB and digital TV products.

Combined, they will offer the widest semiconductor portfolio for STB and digital TV applications in the industry, creating a technology source for developing digital video applications.

The company will provide IC solutions for receiving more digital content in terrestrial, cable, satellite and IPTV broadcast environments with high picture and sound quality, anywhere in the home.

"By acquiring Conexant's BMP activities, our digital TV and STB business will be strengthened in the operator segment of the market and we position ourselves to compete effectively on a global basis" according to Frans van Houten, Chief Executive Officer, NXP Semiconductors.

"We anticipate many R and D synergies from the combination such as the development of IP that can be re-used across NXP's STB and digital television systems portfolio".

Scott Mercer, Conexant's Chief Executive Officer said "NXP has a long history in consumer electronics and they possess the scale, skill sets and resources required to maintain and expand the positions we established".

When the transaction closes, approximately 700 Conexant employees at locations in the United States, India, Northern Ireland, Israel and China will join NXP's home business unit.

The transaction is subject to customary closing conditions and regulatory approvals and is expected to close in the next 60 days.

Conexant's BMP business offers a suite of digital STB components and system solutions for worldwide satellite, cable and IP entertainment broadcasting networks.

The company's product offering includes silicon tuners, demodulators, MPEG audio and video decoders and DOCSIS modems.

Complete reference designs that help manufacturers reduce cost and speed time to market are also available, bundled with a range of operating systems, middleware, drivers and development tools.

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