Mindspeed Technologies, Inc., (NASDAQ: MSPD), a leading supplier of semiconductor solutions for network infrastructure applications, announced that it entered into an agreement on Sept. 4, 2007 to acquire the product portfolio and intellectual property assets of Ample Communications, Inc., an innovative developer of Ethernet media access controller (MAC) products for carrier Ethernet aggregation applications.
Mindspeed will pay approximately $4.6 million in cash to acquire the assets in a private foreclosure sale from Ample’s senior creditor and expects to complete the transaction before the end of its current fiscal quarter subject to the satisfaction of various closing conditions. The company expects revenues from the acquired products to contribute approximately $3 million in its fiscal year 2008 with margins generally in line with the corporate average. The company does not expect any impact to its non-GAAP operating profitability in the first half of fiscal 2008 and expects the acquisition to be accretive in the second half of fiscal 2008 when the acquired products are expected to contribute more meaningful revenues.
Ample’s products ship to major OEM equipment customers for installation in Ethernet metropolitan, access, and enterprise networks, including wireless/cellular backhaul and Ethernet-over-SONET applications. Mindspeed intends to market, sell and support these Ethernet aggregation products with densities ranging from two to 24 ports and Ethernet transmission speeds from 10 Mbps to 10 Gbps. The company also expects to develop and further extend the Ethernet MAC product line.
“With this acquisition Mindspeed will enter a strategic new market segment which we believe will significantly diversify our WAN portfolio,” said Raouf Halim, chief executive officer of Mindspeed. “These products are in production and ship to a number of tier-one OEM customers for use in next-generation Ethernet switches, routers, and access devices for both carrier and enterprise applications.”
“With our network infrastructure expertise, strong customer support and global sales force, we expect to begin building a strong position in the Ethernet aggregation market once this acquisition is completed,” said Ron Cates, senior vice president and general manager of Mindspeed’s WAN business unit.
About Mindspeed Technologies
Headquartered in Newport Beach, Calif., Mindspeed Technologies, Inc. designs, develops and sells semiconductor networking solutions for communications applications in enterprise, access, metropolitan and wide area networks. The company’s three key product families include high-performance analog transmission and switching solutions, multiservice access products designed to support voice and data services across wireline and wireless networks, and WAN communications solutions including T/E carrier physical-layer and link-layer devices, as well as ATM/MPLS network processors. Mindspeed’s products are used in a wide variety of network infrastructure equipment including voice and media gateways, high-speed routers, switches, access multiplexers, cross-connect systems, add-drop multiplexers and digital loop carrier equipment.