Returning to its roots as a fabless semiconductor company, Cirrus Logic Inc. said today that Lucent Technologies will take full ownership of Cirent Semiconductor, their joint-venture wafer fab in Orlando, Fla.
The announcement came on the heels of a similar accord that Cirrus Logic reached with IBM Microelectronics. Last week, IBM agreed to assume full control of the MiCRUS joint venture in East Fishkill, N.Y.
Both moves were made as part of Cirrus' restructuring plan which it implemented last September under its new president and chief executive, David D. French.
Under both deals, the joint-venture fabs will continue to supply wafers to Cirrus through Dec. 31, 2000. After that, supply agreements will be separately negotiated.
Now, Cirrus Logic has completely shed its ownership interest in semiconductor manufacturing facilities and returned to its roots as a fabless semiconductor maker.
"With the closing of these agreements, we are once again a fabless company," a company spokesman said.
The Fremont, Calif., was one of the pioneers of the fabless semiconductor business model.
Last year, Cirrus Logic implemented a companywide restructuring aimed at refining its business strategy and revitalizing growth by concentrating on its strength in embedded applications for mass the storage, industrial, and audio markets. Those efforts also included phasing out its non-profitable and non-strategic businesses.
In its annual report filed with the Securities and Exchange Commission earlier this month, Cirrus Logic said that in fiscal 1999 it had incurred total restructuring charges of $75.5 million and $5.0 million for write-downs and write-offs of property and equipment. The company also said that it had eliminated 445 jobs as of last March.
The company said it expects that the implementation of the restructuring plan will be complete by the end of the first quarter of fiscal 2000.
Upon the closing of its agreements with Lucent and IBM, Cirrus Logic said it will take additional restructuring charges but did not specify the amount. The specific amount of these charges will be reported on July 21, 1999 in its quarterly financial statement.