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chanj
Short range wireless and mesh network have a lot of potential in home automation ...
alan.varghese
This acquisition makes sense for NXP; over the last couple of years they've been ...
NXP buys Jennic, boosts short-range RF portfolio
Peter Clarke
7/26/2010 4:46 AM EDT
LONDON —Dutch chip company NXP has acquired Jennic, a fabless chip company offering wireless connectivity ICs, for $12.2 million plus an additional $7.8 million over the next two years if Jennic meets certain performance targets.
The acquisition gives NXP BV (Eindhoven, The Netherlands) an option to integrate 802.15.4 and Zigbee low-power RF circuits across its own range of mixed-signal circuits with particular benefit for applications in eMetering, smart lighting, building automation, asset tracking and device remote controls.
Under the terms of the deal approximately 50 UK-based employees will transfer to NXP. Short-range wireless products from Jennic Ltd. (Sheffield, England) will become available through NXP's distribution channels. Jennic was founded by CEO Jim Lindop in 1996 and has remained privately held.
"Innovation in low power wireless RF technology is driving significant demand for exciting new applications and usage models across a broad range of industries," said Rick Clemmer, president and CEO of NXP, in a statement. "The low power RF solutions for wireless applications which Jennic has developed have set a benchmark for driving down power performance. These also represent a great example of high performance mixed signal technology, which together will enable us to jointly target attractive growth markets and offer a complete range of wireless semiconductor solutions."
Jennic has developed protocol stacks for Zigbee PRO, 6LowPAN and RF4CE, and has a range of transceivers, chips and modules for low-power narrowband applications designed to meet demand for smart-grid and metering, smart lighting networks, home and building automation and consumer remote controls solutions.
"We strongly believe that 802.15.4 short-range wireless technology has potential to both enable a number of new applications, and replace traditional communications across a range of industries," said Alexander Everke, an executive vice president with NXP, in the same statement. "The benefits of networking technology with low set-up and operation costs are significant, and by integrating Jennic's solutions, we are now able to offer the broadest range of long- and short-range wireless platforms to meet any customer requirement."
Related links and articles:
NXP puts price range on IPO to raise $700 million
NXP in talks on solar cell manufacture at Nijmegen
Jennic forms global partnership with Mitsubishi
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eewiz
7/26/2010 2:16 PM EDT
12.2 m$! I think NXP got the company for a very low price. Jennic could have focused all their effort on a single interesting product/application and could have raised a VC fund for a similar amount.
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alan.varghese
7/26/2010 2:58 PM EDT
This acquisition makes sense for NXP; over the last couple of years they've been narrowing their focus to high performance, low power analog and mixed-signal ICs and been shedding everything else. In 2009, they transferred their Sytem-on-chip IP and resources to partner Virage Logic, and more recently in 2010 sold their set-top business lines to Trident.
I'm not as sure for Jennic especially at such a low initial price of $12.2 million. My guess would be that Jennic's market segments of Metering, Telehealthcare, Remote control, RFID, etc. were taking longer than they anticipated to take off, because these industries are subject to multiple industry regulations, and require a critical mass of ecosystem partners. And the global slowdowns of the last couple of years probably didn't help either.
At the same time, the burn-rate for Jennic was probably high, with having to support multiple wireless microcontroller designs (along with the associated CPU, RF, power management design angineering),
different protocol stacks, and hardware reference designs. So the buyout offer from NXP was probably hard to resist.
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chanj
7/26/2010 3:26 PM EDT
Short range wireless and mesh network have a lot of potential in home automation and smart home product. I believe NXP move is a good move towards preparing solution to the new market.The question comes down to how mature the Zigbee protocol definition is. If Zigbee can't be multi-vendors compliance, the chance of success is low. I would love to hear some insiders' comment on where the status of Zigbee protocol development is.
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