LONDON Microtune Inc. (Plano, TX) is buying, for about $9 million in cash and stock, fabless chip startup Auvitek International Ltd.
Auvitek (Fremont, Calif.) develops DTV demodulator integrated circuits (ICs) for the HDTV and TV- enabled peripherals markets with primary engineering operations based in Shanghai, China. The company also has sales, design and engineering facilities in Shenzhen, Hong Kong, and Taipei and employs about 80 people worldwide.
Late 2006, Auvitek secured $9 million in Series B financing led by BA Venture Partners. Other backers included KLM Capital Group, Storm Ventures and VenGlobal Capital.
Microtune says the addition of Auvitek's complementary digital components will transform the inventor of the single-chip tuner "from a pure-play tuner supplier to a developer of highly integrated RF-to-bits solutions."
"The acquisition of Auvitek's team and technology will not only enable us to target a larger opportunity in the worldwide integrated digital TV market, but also will allow us to better serve customers with more complete solutions," said James Fontaine, President and CEO of Microtune.
"Our strategy is to move beyond tuners to add other digital components in the receiver pipeline, and in this regard, we believe that this strategic acquisition gives
us a competitive advantage in the DTV market. We are building on our established beachhead in TV tuner ICs.
"We believe that a company starting with a commercial,
market-proven RF silicon tuner will be more successful adding digital functions than a competitor who starts with digital technology and tries to add RF capability," Fontaine added in an interview.
"Because of the affinity of our RF products with digital demodulators, adding these products to our portfolio and adding the resources and capabilities to develop these products seemed to be a logical next step. Now, with our core tuner technology, coupled with Auvitekís demodulator ICs, we have the building blocks for a wide range of highly integrated RF-baseband solutions in the future."
Fontaine stressed the Auvitek acquisition will not change MIcrotune's business strategy in cable.