COLORADO SPRINGS, Colo. -- Simtek Corp. here announced a partnership and investment in WebGear Inc., a privately held supplier of wireless products based in San Jose.
Simtek, a supplier of reprogrammable nonvolatile ICs, said it will collaborate with four-year-old WebGear to define system architectures and chip product requirements for emerging, high-growth wireless applications. As part of the arrangement, Simtek will issue 1.25 million shares of common stock in exchange for nearly 1.9 million shares of WebGear. Based on current stock prices, the investment is worth about $1.6 million.
"In the next few months, we will start to combine the expertise from both groups, along with direction from sources--including our WebGear collaboration--to create new classes of products that allow us to enter exciting new markets," said Douglas Mitchell, president and CEO of Simtek.
Simtek will participate in technical decisions at WebGear, and it will have a seat on the company's board of directors.
"We have set a goal to expand our core infrastructure in preparation for future market requirements including high growth wireless applications," Mitchell said. "This relationship with WebGear will give us initial exposure into these technologies, and even though this is not intended to create new Simtek IC products in the near term, it will provide access to information that will lead us in that direction," he added.
Last month, Simtek acquired Integrated Logic Systems Inc. of Colorado Springs to add logic IC capabilities to its product portfolio (see May 15 story). Also in late May, Simtek announced it would offer nonvolatile SRAM products being discontinued by Xicor Inc. of Milpitas, Calif.
During the first quarter of this year, Simtek posted a net income of $299,768 on net sales of $2.5 million, compared to net loss of $68,387 and sales of $1.4 million in the first three months of 1999.