Conexant forms SiGe foundry company with the Carlyle Group
Carlyle will hold 55 percent of the equity of the new company and Conexant will own 45 percent. Under the terms of the agreement, Carlyle will pay Conexant $20 million and will contribute $30 million in cash to the new venture. Conexant will contribute its specialty process technologies and the manufacturing equipment in its Newport Beach wafer fabrication facility. Conexant s three business units will be served by the new company under long-term supply contracts. These include the wireless business, which will merge with Alpha Industries, as well as the businesses serving the broadband access and Internet infrastructure markets.
"The Carlyle Group has a global reputation for building value in strategic investments, and we are pleased to partner with them as we take a leadership role in defining the next step in the evolution of the semiconductor foundry industry, said Dwight Decker. "We believe the foundry market is now ready to expand from mainstream CMOS wafer manufacturing to include sophisticated specialty-process capabilities, and in the process enable the development of a new market segment of fabless RF-centric semiconductor product companies. We anticipate that this new company will enhance existing Conexant shareholder value as it rapidly becomes a global center of excellence for innovative specialty foundry services.
The transaction, which does not require regulatory approvals, is expected to be completed by the end of March. Further details, including the name of the new company, will be announced over the next 60 to 90 days.
The new specialty foundry company will continue production with 0.35-micron SiGe BiCMOS processes operating at frequencies up to 70 GHz, and will focus its ongoing research and development activities on a next-generation SiGe BiCMOS technology featuring 0.18-micron geometries and operating frequencies of greater than 160 GHz. This offering, which will consume approximately half the power of competing technologies, is scheduled for production release in the second calendar quarter of this year. In addition, the new company will complete the development of a further enhanced 200 GHz SiGe BiCMOS process technology. This will bring the cost advantages of silicon to a broad range of highly integrated optical networking devices, and provide low noise, low power and improved linearity benefits for wireless communications devices.
About the new specialty foundry company
Headquarters: Newport Beach, Calif.
Headcount: Approximately 650 employees
Revenues: Approximately $150 million in the first full year of operation
Cleanroom: 100,000 square feet of Class 1 cleanroom space
Capacity: 20,000 eight-inch wafer starts per month
Process technologies: Bipolar, BiCMOS, silicon germanium, analog and mixed signal CMOS
Conexant Systems, Inc.
Lisa Briggs, editorial
Tel. +1 949 483-1148
Thomas Schiller, investor relations
Tel. +1 949 483-4707
or
The Carlyle Group
Chris Ullman
Tel. +1 202 585-1443
E-mail: n/a
Web site: http://www.conexant.com
