Broadcom snaps up Renesas' LTE chip unit for $164 million
Broadcom announced on Wednesday it will pay $164 million to buy wireless 4G LTE assets from Japanese firm Renesas.
The wireless chip maker said the acquisition will help accelerate the availability of Broadcom's first carrier-validated 4G LTE system-on-a-chip (SoC) in early 2014. Detailed in investor slides, the firm noted how the deal will strengthen its intellectual property portfolio while boosting its cellular engineering talent base, and aims to position itself as a market leader.
It comes at a time where Broadcom is lagging behind Qualcomm, its main rival in the smartphone and tablet wireless chip-making space. Renesas previously announced it would no longer supply 4G wireless technologies from June.
According to AllThingsD, chip designers from Finland, India, and the U.K. will become Broadcom staff, but details on the number of employees remains unseen. The team also includes former Nokia engineers with decades of experience, the firm said.
The chip maker said non-GAAP earnings per share impact will be dilutive by about 12 cents, and between 10 and 15 cents per share for 2014. Earnings per share while roughly neutral by the second-half of 2014, and accretive in 2015.
Looking ahead, Broadcom said it expects its third-quarter revenue to be between $2.07 billion and $2.17 billion as a result of this transaction.