RFMD teams with and invests in Jazz
As part of the agreement, RFMD will obtain a guaranteed, lower-cost supply of wafers fabricated utilizing Jazz Semiconductor s manufacturing processes, including SiGe, BiCMOS and RF CMOS. In addition, RFMD will collaborate with Jazz on the development of wireless technology roadmaps, including joint process development and the optimization of these processes for fabrication of next-generation silicon RFICs. The arrangement is expected to help RFMD develop proprietary mixed-mode silicon technologies for its system-on-chip (SOC) integration roadmap.
Furthermore, RFMD is to invest $60 million in Jazz for a minority equity position in the company. Jazz was spun off from Conexant in February 2002, and is majority-owned by the Carlyle Group.
"Jazz is a leader in advanced SiGe BiCMOS and RF CMOS manufacturing processes with substantial, state-of-the-art silicon foundry resources," said Jerry Neal, executive VP of strategic development and co-founder of RF Micro Devices, who will join the Jazz board. "We believe this strategic relationship strengthens our competitive position as an integral part of our customers supply chains by providing us with a guaranteed source of supply for high-performance silicon manufacturing capacity."
RFMD expects its lower cost structure will enable cost reductions across its silicon product portfolio, while facilitating expansion in new markets and generating incremental growth opportunities in current markets, such as IEEE 802.11.
"In the near term, we expect a positive impact on cycle times, cost reductions and margin improvement efforts currently underway in our PA module product line," said Neal. "Many of the millions of PA modules we ship each month contain the industry s most advanced power control circuitry, which is manufactured under high-voltage CMOS processes and is currently sourced through traditional foundry relationships."
"We are very pleased to have been selected by RFMD as their silicon manufacturing partner, and look forward to working with them to further strengthen their leading-edge wireless communications product portfolio," said Shu Li, president and CEO of Jazz. "We are committed to providing cost-effective, high-performance RF and mixed-signal silicon wafer foundry solutions. Our arrangement with RFMD is indicative of the close collaboration we have with our customers, and our dedication to enabling their product development efforts."
