Conexant Systems Inc. snapped up GlobespanVirata Inc.'s video-compression
business for approximately $21 million in cash and 1.25 million shares of
Conexant stock.
Conexant plans to use the Moving Picture Expert Group compression technology
to boost its video-encoding product line for PCs and cable set-top boxes. It
also can be used in applications for gaming consoles and digital-video
recorders.
The deal also includes contingent payments to GlobespanVirata based on the
video business and Conexant's stock performance.
'This strategic acquisition enhances our portfolio by adding advanced
digital-media-compression technologies that are critical to our long-term
product road map in digital-video markets and are synergistic with our current
product offerings in the PC and set-top-box markets,' said F. Matthew Rhodes,
president of Conexant's broadband-communications segment.
'The MPEG-compression group has proven capabilities in bringing innovative
solutions to market, and the addition of this team will further strengthen our
ability to quickly deliver leading-edge video-processing products,' he
added.
GlobespanVirata's 45-person MPEG-compression team will continue to be located
in San Jose, Calif.
