Microtune acquires Bluetooth chip maker

Purchase target Transilica specialises in system-on-chip designs for Bluetooth and other short-range wireless technologies

Texas-based Microtune, a maker of radio-frequency (RF) chips and systems, is to make a quick entry into the Bluetooth market with its acquisition of Transilica, the companies announced on Monday.

Transilica, a San Diego, California-based Bluetooth chip developer, is to double Microtune's revenues to $120m (about £84m) for 2002, Microtune said.

The acquisition brings Microtune into a market which may be about to take off, according to industry analysts. While Bluetooth -- a short-range radio technology for linking digital devices and PCs -- has been around for several years, mature products are only now arriving on the market. Several mobile phone handsets, handsfree devices, laptop and PC add-ons and PDA add-ons are now available.

Microtune will compete with companies like the UK's Cambridge Silicon Radio (CSR) who are already established in the market.

Transilica designs CMOS-based system-on-chip products based on Bluetooth, 802.11a and other short-range wireless technologies. Its OneChip system-on-chip design includes flash memory and embedded application software in a compact package. The company says it employs a substantial in-house team of engineers specialising in RF systems, RF integrated circuits, digital integrated circuits and software.

Microtune will issue 19.99 percent of its outstanding shares in exchange for all Transilica stock and stock options. The deal is expected to be completed next month.

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