Applied Micro Circuits Corporation (San Diego, Calif.) is expanding its communications chip line-up with the acquisition, for $47 million, of IBM's packet routing and switching operations.
As part of the deal, IBM, which is already an AMCC vendor, will continue to make the PowerPRS switch fabric devices.
Earlier this month, IBM cut a similar deal with Integrated Device Technology Inc. (Santa Clara, Calif.) whereby it sold the content addressable memories operations of its network search engines business and product line up to IDT in return for a continuing foundry deal.
IBM and AMCC are also talking to local regulatory authorities regarding the proposed sale to AMCC of certain related assets of La Compagnie IBM France, a French affiliate of IBM, for approximately $3 million.
AMCC said exact details of the acquisitions will be outlined on October 23rd, when the company announces its second quarter financials.
Currently in its fifth generation of products, IBM's Packet Routing and Switching (PRS) product line is designed into numerous leading OEM platforms that are now in production and ramping to volume.
"The acquisition of the IBM switch fabric product line allows us to offer our customers an extensive, compatible set of scalable switching solutions targeted at multiple applications, including the core, metro, wireless, and SAN markets. This is a perfect complement to our existing switch fabric portfolio," commented Dave Rickey, chairman, president and CEO of AMCC.