SAN FRANCISCO—Microsemi Corp. has no intention of killing off any Actel Corp. product lines following the anticipated close of the $430 million tender offer the company made for Actel earlier this week, according to Russell Garcia, Microsemi's executive vice president of marketing and sales.
"These products are so differentiated in the marketplace," Garcia said. "We want to take full advantage of that and continue to grow and build on it."
Instead, Garcia said, Microsemi would shy away from seeking new design wins in sockets where the appeal of Actel products is not sufficient to command high margins. Garcia said Microsemi would channel engineering, marketing and sales resources to focus on design wins in applications where Actel's low-power, mixed-signal and radiation-hardened FPGAs offer the most value to customers and thus would generate the most profitability to Microsemi.
"The only reason you don't get the value for your differentiation is that the customer doesn't see the valuation," Garcia said. "Otherwise they are willing to pay more for it."
Garcia said applications where Actel's technology is sufficiently differentiated to command higher margins include not only many military and aerospace end markets but also medical, industrial and even some consumer grade applications.
"We just aren't going to compete one on one in a mass market arena where our low power differentiation is not valued," Garcia said. "It's that simple."
Garcia's comments came two days after Microsemi President and CEO James Peterson, in a conference call with analysts to discuss the $430 million tender offer, made comments that many interpreted to mean Microsemi would discontinue some Actel product lines where Microsemi felt that it was trailing the leading programmable logic vendors, Xilinx Inc. and Altera Corp.
Peterson never specifically stated that Microsemi would kill some Actel product lines, but made statements suggesting that Actel would no longer chase the market leaders in some commercial applications.
"Where we can differentiate and add value while driving high-growth opportunities we will do so," Peterson said. "Where dollars have been spent chasing an entrenched incumbent, we will disengage."
Peterson also said during the call, "I intend to walk away from commercial business that dilutes profitability." Later, he suggested that Actel might have taken on some business in an effort to "take down the two big dogs" and said that in some areas Microsemi wouldn't chase Xilinx and Altera.