IDT and PMC Sierra announced plans for PMC Sierra to acquire the IDT Enterprise Flash Controller product line along with approximately 75 PCIe related patents.
The deal is valued at nearly $100 Million and expected to close by October 2013.
IDT anticipates this sale will affect about 50 employees and it’s anticipated that PMC Sierra will wish to bring them into the new division to provide a continuity of customer support and product development.
Ted Tewksbury, President and CEO at IDT, commented on the deal:
The divestiture of our PCIe flash controller business enables IDT to capitalize on our early investments in this disruptive technology.
Going forward, we will focus our R&D investments on advanced timing, wireless power, memory interface, and communications signal chain solutions. This enhanced focus will accelerate operating margin expansion while sustaining long-term revenue growth.
The potential for PMC Sierra is to gain a leading edge in the competitive enterprise solid-state-drive (SSD) market. The SSD customers are currently weighted towards the commercial and consumer side. However, with growing demands for cloud services and corporate data centers, the enterprise portion of the SSD market is projected to reach nearly 50% of the $14 Billion market in 2016.
Greg Lang, President and CEO of PMC, added his opinion of the acquisition as:
Flash-based storage is causing a major disruption in enterprise storage due to the dramatic performance advantages of solid-state drives.
IDT’s PCIe controllers are particularly well suited for server-based SSDs targeted at cloud data center customers. The acquisition of IDT’s Enterprise Flash Controller Business is a strong complement to our current enterprise 12Gb/s SAS SSD controller product offering.
It’s expected that this transaction will pass through the SEC approval process, unlike last years’ attempt by IDT to purchase the PLX PCIe product portfolio and technology.
Related Article – IDT and PLX Merger Terminated After FTC Challenge
(Image Credit – IDT)
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