Cypress to Acquire Broadcom's Wireless Internet of Things Business

SAN JOSE, CA -- Cypress Semiconductor Corp. and Broadcom Limited signed a definitive agreement under which Cypress will acquire Broadcom's Wireless Internet of Things (IoT) business and related assets in an all-cash transaction valued at $550 million. Under the terms of the deal, Cypress will acquire Broadcom's Wi-Fi, Bluetooth and Zigbee IoT product lines and intellectual property, along with its WICED brand and developer ecosystem. Broadcom's IoT business unit, which employs approximately 430 people worldwide, generated $189 million in revenue during the last twelve months. The acquisition strengthens Cypress's position in key embedded systems markets, such as automotive and industrial, and establishes it as a leader in the high-growth consumer IoT market, a segment that includes wearable electronics and home automation solutions.

The transaction, which has been approved by the board of directors of Cypress and Broadcom, is expected to close in the third calendar quarter of 2016, subject to customary conditions and regulatory approvals. Cypress expects the transaction to be accretive within a year of closing and to improve its gross margin, earnings and long-term revenue potential.

Under the terms of the deal, Broadcom will continue to focus on its wireless connectivity solutions for the access and mobility segments that are not IoT related, including serving set-top box, wireless access, smartphone, laptop and notebook customers. Cypress will capitalize on the rapidly growing Wi-Fi and Bluetooth connectivity (17% per year1) markets in consumer, industrial and automotive IoT segments.

Greenhill & Co., LLC served as lead financial advisor, Bank of America Merrill Lynch served as financial advisor and is providing committed debt financing, subject to customary conditions, and Wilson Sonsini Goodrich & Rosati acted as legal counsel to Cypress for this transaction.

To learn more, go to http://www.cypress.com
 

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