AMD and Broadcom have entered into an agreement that would net Broadcom AMD's Digital TV business. The deal will cost Broadcom $192.8 million in cash. Broadcom says that the acquisition still needs to get AMD shareholder approval and it hopes that the deal will be complete in Q4 2008.
For its $192 million, Broadcom will get AMD's full DTV product line including the Xilleon integrated DTV processor, complete turnkey reference designs, NXT receiver ICs, and the Theater 300 DTV processor. Broadcom will also get other processors that improve video playback performance with motion compensation, frame rate conversion, and scaling.
DTV processors and other intellectual property are not all the acquisition will get Broadcom. Broadcom will also be inviting all 530 of the AMD dedicated DTV personnel to join it as well as key managers and marketing personnel for AMD's DTV business.
The 530 current AMD employees are located in six design centers around the world. Broadcom says that the acquisition of AMD's DTV business will allow it to immediately scale its DTV business and expand its tier one customer base. Broadcom also says that the acquisition will give it a complete DTV lineup covering DTV from low-end to high-end.
Until the acquisition is approved by AMD shareholders, Broadcom will place a portion of the $192.8 million into an escrow account. Broadcom says that the acquisition still needs to be approved by its shareholders as well.
AMD CEO Dirk Meyer said in a statement, "AMD is executing a strategic plan to transform the company, becoming leaner and more focused while seeking to create a business model to deliver sustainable profitability. The sale of our DTV business is a key step in AMD's transformation, helping to strengthen our balance sheet, lower our breakeven point, and hone our focus in order to take full advantage of our position as a leader in both microprocessors and graphics technology. Broadcom will be a great fit for our talented DTV employees and the DTV products they have created."
