Broadcom Buys NetLogic for Its Network Chips

The transaction involves a payment of about $3.7 billion on Broadcom's part

Many buyouts have occurred in the IT industry, like they have been happening in all other segments of the industry as a whole, and the newest one to be announced is the deal sealed by Broadcom and NetLogic.

Broadcom already has an extensive collection of wired and wireless communications chips, but its portfolio will grow substantially, given the recent press release involving it and a certain other company.

Said other company is NetLogic, an outfit that specializes in the same field, that of network chips.

What will happen is that Broadcom will fully integrate NetLogic's assets into its own, complete with the IP (intellectual property).

“This transaction delivers on all fronts for Broadcom’s shareholders - strategic fit, leading-edge technology and significant financial upside,” said Scott McGregor, Broadcom’s president and CEO.

“With NetLogic Microsystems, Broadcom is acquiring a leading multi-core embedded processor solution, market leading knowledge-based processors, and unique digital front-end technology for wireless base stations that are key enablers for the next generation infrastructure build-out. Broadcom is now better positioned to meet growing customer demand for integrated, end-to-end communications and processing platforms for network infrastructure.”

Broadcom will pay a sum of roughly $3.7 billion to NetLogic's shareholders, each of which will get $50 per share.

All proceedings should complete at some point during the first half of next year (2012).

“This is a strong win for customers, for shareholders and for NetLogic Microsystems employees,” said Ron Jankov, NetLogic Microsystems president and CEO.

“Our industry-leading product portfolio will benefit from access to Broadcom’s broad set of leading-edge technologies, tools, resources and eco-system, which will enable the combined company to offer a complete and integrated platform for our customers’ next generation designs. Our employees will benefit from the strong cultural alignment with Broadcom, and from joining forces with an equally aggressive and energetic organization with the same relentless focus on engineering excellence and innovation.”

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