COLORADO SPRINGS, Colo. Entropic Communications Inc., a specialist in network processors for coaxial-cable home networks, has signed a definitive agreement to acquire its San Diego neighbor, RF Magic Inc., a developer of microtuners for digital TV. Terms of the all-stock transaction between the two privately held companies were not disclosed.
Entropic president and chief executive officer Patrick Henry will become CEO of the merged company, while RF Magic president and chief executive Mark Foley will become chief operating officer. Itzhak Gurantz, founder and chairman of Entropic, will be chief technology officer. The CTO and co-founder of RF Magic, Dale Hancock, will be vice president of RF technology, while Entropic's co-founder and CTO, Anton Monk, will be vice president of communications technology.
The companies said they expect few layoffs as the acquisition is completed. Entropic predicts an employee base of 200. It plans to retain its own design center in Hong Kong as well as an RF Magic design center in Nice, France, and a design center in Israel acquired when Entropic bought Arabella Software Inc.
While Entropic has been largely identified with the Multimedia over Coax Alliance (MoCA) because of its c.Link chip set, the acquisition of RF Magic would expand its mission to cover a range of digital TV standards, including tuners for terrestrial over-the-air, satellite and DVB-C cable television.
Besides tuners, RF Magic has designed a line of channel-stacking switches and offers customer-premises ICs for WiMax access platforms. Foley said RF Magic's original product was an RF front end for the 2.5- to 2.7-GHz 802.16d fixed broadband market, where RF Magic now maintains 40 percent market share.
Entropic, meanwhile, brings a range of algorithm expertise in areas such as modulation and packet prioritization. Entropic recently augmented its higher-layer software with the acquisition of Arabella Software, a specialist in routing, packet processing and protocols operating at Layers 2 through 5.
Henry said RF Magic was courted for its general RF systems design expertise as much as for its expertise in television markets. The ability to integrate multiple RF blocks in one design is useful not only in developing multituner architectures but also in integrating many functions in distributed home networking, he said.
Foley said that RF Magic still relies on a few specialized foundries, primarily BiCMOS, for its channel-stacking switches but that most of its products are produced in standard CMOS.