HUNTSVILLE, Ala. — Lattice Semiconductor, one of the last independent FPGA companies, has just announced that it has agreed to be acquired by Canyon Bridge Capital Partners — a newly formed, global private equity buyout fund that is headquartered in Palo Alto, California — for approximately $1.3 billion inclusive of Lattice’s net debt, or $8.30 per share in cash. This represents a 30% premium to Lattice’s final trade price on November 2, 2016, the last trading day prior to the announcement.
This latest acquisition leaves Xilinx as "the last man standing" with regard to the larger FPGA players. Actel was acquired by Microsemi in 2010 and Altera was acquired by Intel in 2015. In both of those cases, there was a technology play behind the story. Microsemi is big in security, and Actel's Flash-Based SmartFusion SoC FPGAs can play a big role in the secure boot process, for example. Meanwhile, Intel is huge in CPUs, and the combination of these CPUs with Altera's FPGAs — as separate devices, mounted in the same package, or, ultimately, fabricated on the same die — will be very important with regard to applications like high-performance computing (HPC).
In early 2015, Lattice acquired Silicon Image, touting the advantages of having both an FPGA and ASSP play (see Lattice Deal: Harbinger of FPGA & ASSP Union). One of the first offspring from this marriage was the CrossLink family of video bridge pASSPs (programmable ASSPs).
There is no technology play in the case of Canyon Bridge acquisition of Lattice — this is purely a financial play. The newly-formed Canyon Bridge wants to be a player in the technology market, and it sees Lattice Semiconductor as the anchor for their long-term investment portfolio, said Doug Hunter, senior director of marketing at Lattice Semiconductor in an interview with EE Times.
Canyon Bridge is going to leave the Lattice team in place while providing investment to accelerate what Lattice is already doing, Hunter told us. This actually makes a lot of sense, because for Lattice has been carving out a nice niche (a large and growing niche) for itself over last few years with regard to small-to-medium capacity, low-power FPGAs deployed in a wide range of mobile, home, and augmented/virtual reality market applications (in addition to FPGAs, Lattice also boasts its pASSP products and a suite of power and thermal management solutions).
Hunter says that Lattice has been talking to shareholders and investors about its long-term vision, and that Canyon Bridge believes in this vision and wants to play a part in it.
But does Canyon Bridge know how to handle a high-tech company? Well, even though its described as "a newly formed, global private equity buyout fund," the Canyon Bridge leadership team has deep roots in Silicon Valley. Collectively, the principals in Canyon Bridge have more than 50 years of experience in the global technology, private equity, and M&A markets from the perspectives of founders, senior management, board members, and equity investors.
In this day and age, where everyone is buying everyone else, Lattice was starting to look a little left out. Lattice's strategy of focusing on niche markets was good as far as it went, but niche markets simply aren’t going to cut it in the current business environment. Having serious investment from Canyon Bridge — coupled with the explosion in the IoT and cognitive (thinking, reasoning) systems boasting artificial neural networks and machine learning, vision, and speech — may allow Lattice to evolve and grow its "niche" and become a major player.
— Max Maxfield, Editor of All Things Fun & Interesting