LONDON – Broadcom Corp. has announced that it has agreed to pay $75 million in cash to acquire Gigle Networks Inc., a privately-held company that develops system-on-a-chip (SoC) solutions for home networking over power lines.
About $8 million in cash will be reserved for future payment to the former holders of Gigle Networks capital stock and other rights upon satisfaction of certain performance goals.
Gigle Networks (Barcelona, Spain), founded in 2005, offers powerline networking technology that is HomePlug AV certified and is designed to be compliant with the IEEE 1901 standard for high-speed powerline communications.
This complements Broadcom's portfolio of wired and wireless solutions for the home. It should allow Broadcom offer additional functionality in set-top box, broadband carrier access and wireless router applications.
The acquisition will also accelerate Broadcom's time to market for G.hn, a draft specification for existing-wire home networking, developed under the International Telecommunication Union.
"The worldwide market has demanded technologies for powerline, co-ax and wireless networking using standards such as Wi-Fi, MoCA, HomePlug AV, IEEE 1901 and G.hn to allow the streaming of multiple high definition and 3D video streams," said Jason Blackwell, an analyst with ABI Research in a statement issued by Broadcom. "With electric outlets readily available around the home, more consumers are seeing the benefits of powerline, and service providers' increased push toward gateways and IPTV is expected to help increase the market at a 32 percent compound annual growth rate from 2010 to 2015."
The shareholders of Gigle Networks and the boards of directors of the two companies have approved the acquisition. The transaction is expected to close in the fourth quarter of 2010 and remains subject to customary closing conditions.
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