Intel Sells Communication Rackmount Server Operation to Kontron

Kontron, a leading global provider of embedded computing and open modular solutions, has reached an agreement with Intel Corporation to acquire its Communication Rackmount Server operation of 1U, 2U carrier-grade rackmount and IP network security server products. The transaction, subject to regulatory review and standard closing conditions, is expected to close shortly.

The Intel carrier-grade rackmount and network server team mainly centered in Columbia, South Carolina, and Penang, Malaysia, which include various employees engaged in engineering, product development, product marketing, technical support and operations. Kontron’s Management expects for 2009 revenue from this new acquisition of more than USD 40 million. This acquisition is considered a strategic opportunity and is expected to close shortly. This intact group in Intel, with around 70 employees, has many years of expertise in world-class server technology, including high-density mechanical and electronic design, thermal and vibration analysis, and implementation of high-standards of secure and uninterruptible operations. To help ensure a continuous supply of products and a high-quality of support and services to Intel customers, both Intel and Kontron will work jointly in the transition period to provide a smooth and seamless hand-over of products, projects, and customer and distributor relationships. Customers will also be backed by Kontron’s strong global presence, flexible supply chain capabilities; including a high-volume manufacturing services facility in Penang, Malaysia, and engineering and technical support services.

The benefits for customers are tremendous, said Kontron CEO Ulrich Gehrmann. customers will continue to receive the latest technology in computing platforms while being able to choose from a single source. Both the existing Intel products and any future Intel Architecture multi-core server designs will firmly establish Kontron the leading provider of multi-core carrier-grade server platforms. After many years of working closely with Intel, we fully anticipate strong favorable long-term growth.

Intel is pleased to reach this agreement with Kontron, an Intel Embedded Communications Alliance Premier member and one of the world’s leading embedded computer companies. We will work closely with them to transition support for customers of these products, said Doug Davis, Vice President of the Digital Enterprise Group and General Manager of the Embedded and Communications Group at Intel.

The addition of Intel communication servers will be an excellent complement to the Kontron family of AdvancedTCA and MicroTCA communication platforms and industrial rackmount servers. It will enable Kontron to further address the needs of tier 1 and tier 2 telecom and network equipment providers who need to deliver compelling solutions for the growing communications market. The Intel line of carrier-grade servers provide a choice of Quad-Core Intel Xeon processors based on Intel’s latest 45nm technology for industry-leading performance-per-watt processing. These 1U and 2U servers are NEBS-3 and ETSI-compliant and are an excellent choice for demanding central office environments and the limited space of highly available data centers. They support a diverse set of applications that include: unified messaging, S(service)oIP, call control, media and signaling gateways, and operational system support.

The Intel family of IP network security servers comprised of 1U, 2U servers are ideally suited for enterprise application acceleration and content caching, as well as for running Telco SoIP, such as IMS, IPTV, video on demand (VoD), SIP application servers, IP-PBX, and IP-PSTN gateways.

Kontron designs and manufactures standard-based and custom embedded and communications solutions for OEMs, systems integrators, and application providers in a variety of markets. Kontron engineering and manufacturing facilities, located throughout Europe, North America, and Asia-Pacific, work together with streamlined global sales and support services to help customers reduce their time-to-market and gain a competitive advantage. Kontron’s diverse product portfolio includes: boards and mezzanines, Computer-on-Modules, HMIs and displays, systems, and custom capabilities. Kontron is a Premier member of the Intel® Embedded and Communications Alliance. The company is a recent three-time VDC Platinum vendor for Embedded Computer Boards. Kontron is listed on the German TecDAX stock exchange under the symbol “KBC”.

Kontron is a trademark or registered trademark of Kontron AG. Intel and Intel Xeon are trademarks of Intel Corporation in the US and other countries. AdvancedTCA and MicroTCA are trademarks of the PCI Industrial Computers Manufacturers Group.