Chipmaker Broadcom Acquires Widcomm
Posted on: Monday, 17 May 2004, 06:00 CDT
Irvine-based chipmaker Broadcom Corp. said last week it plans to buy San Diego communications software maker Widcomm for $49 million, mostly in stock.
Privately held Widcomm makes core software for a short-range communication technology called Bluetooth. The company has roughly 60 employees.
Broadcom, which already has a presence in San Diego with an office in Carmel Mountain Ranch, is a $1.6 billion company that makes chips for various communications technologies - including a line of Bluetooth chips. Broadcom trades on the Nasdaq under the symbol BRCM. The company's stock closed at $38.24 on April 20.
Widcomm Chairman Hiep Pham and Chief Technology Officer Rajiv Kumar founded Widcomm in 1998, with the idea of working in short- range radio. The two subsequently settled on the Bluetooth standard, which can link two devices up to 30 feet away. Bluetooth can be a cord-replacement technology that connects a desktop computer and a mouse or a printer. Likewise, Bluetooth can link a cell phone with a headset wirelessly.
An outside executive, Bob Hunsberger, replaced Pham as Widcomm's chief executive in the fall of 2003.
The Broadcom acquisition is expected to close before June 30, and Broadcom may elect to apply $3 million in cash to the $49 million purchase price.
Widcomm has raised more than $58 million from investors such as Enterprise Partners, Mission Ventures, Sienna Ventures, the Viterbi Group, Texas Instruments, Alcatel, Conexant, Philips, Psion, KDC, Comerica Bank, and AsiaTech Management.
Widcomm's customers., include Dell, Hewlett-Packard, IBM, Logitech, Panasonic, Samsung, and Sony. Widcomm engineers handle do system integration work.
Broadcom has a long history of acquisitions. Earlier this month it acquired Sand Video of Andover, Mass., a video compression chip developer, for $77.5 million in cash and stock.
Copyright San Diego Business Journal Apr 26, 2004
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