Broadcom Picks Up AMD's Chips

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Broadcom, a key supplier of semiconductors used in cable set-tops, modems and other devices, will get a foothold in the low-end digital television market with its acquisition of AMD's digital TV chips business for $192.8 million in cash.

Through the deal, Broadcom said, it can immediately scale its DTV business, to offer a complete product line that covers all segments of the digital television market, ranging from low-end value and midrange quality to high-end interactive platforms and panel processors.

The acquisition of AMD's digital TV business “will enable us to significantly scale and accelerate the completion of our digital-TV product portfolio while also expanding our tier-one customer base and positions us to achieve leadership and long-term growth in this important market segment,” Daniel Marotta, senior vice president and general manager of Broadcom's Broadband Communications Group, said in announcing the acquisition.

Broadcom will offer jobs to about 530 employees in AMD's DTV unit, plus others directly supporting the group, located in six primary design centers around the world.

AMD's DTV product line includes Xilleon integrated DTV processors and reference designs, as well as NXT receiver integrated circuits, the Theater 300 DTV processor, and a line of panel processors that perform advanced motion compensation, frame rate conversion and scaling.

AMD is selling its digital-TV chip business to become “leaner and more focused while seeking to create a business model to deliver sustainable profitability,” CEO Dirk Meyer said in a statement.

The deal is expected to close during the fourth quarter, pending usual closing conditions and regulatory review. The companies said their boards have approved the transaction, which does not require shareholder approval.