IRVINE, Calif., Oct. 28 /PRNewswire-FirstCall/ -- Broadcom Corporation (NASDAQ: BRCM), a global leader in semiconductors for wired and wireless communications, today announced that it has completed the acquisition of AMD's (NYSE: AMD) digital TV (DTV) business. The acquisition is expected to enable Broadcom to immediately scale its DTV business, and, in conjunction with its existing products, offer a complete product line that covers all segments of the DTV market, ranging from low-end value and mid-range quality to high-end interactive platforms and panel processors.
On August 25, Broadcom announced a definitive agreement to acquire AMD's DTV business, noting that the transaction is expected to enhance and strengthen Broadcom's innovative DTV system solution offerings while delivering the scale and focus needed to forge a market-leading DTV business. The acquisition also is intended to expand Broadcom's existing tier-one customer base, which includes top DTV brands worldwide.
Broadcom now anticipates that AMD's DTV business will have fourth quarter revenue between $15 and $20 million, lower than previously expected. Accordingly, the parties agreed to reduce the purchase price from $192.8 million to $141.5 million in cash (in each case, minus certain accrued employee-related amounts). The anticipated dilutive impact to EPS of $0.04 to $0.05 per share in 2009, with the combined DTV business approaching EPS neutrality in the fourth quarter of 2009, has not changed. A portion of the consideration payable to AMD was placed into escrow pursuant to the terms of the definitive asset purchase agreement. Broadcom may record a one-time charge for purchased in-process research and development expenses related to the acquisition in the fourth quarter of 2008. The amount of that charge, if any, has not yet been determined.
Broadcom Corporation is a major technology innovator and global leader in semiconductors for wired and wireless communications. Broadcom(R) products enable the delivery of voice, video, data and multimedia to and throughout the home, the office and the mobile environment. Broadcom provides the industry's broadest portfolio of state-of-the-art system-on-a-chip and software solutions to manufacturers of computing and networking equipment, digital entertainment and broadband access products, and mobile devices. These solutions support Broadcom's core mission: Connecting everything(R).
Broadcom is one of the world's largest fabless semiconductor companies, with 2007 revenue of $3.78 billion, and holds over 2,900 U.S. and 1,300 foreign patents, more than 7,600 additional pending patent applications, and one of the broadest intellectual property portfolios addressing both wired and wireless transmission of voice, video, data and multimedia.
Broadcom is headquartered in Irvine, Calif., and has offices and research facilities in North America, Asia and Europe. Broadcom may be contacted at +1.949.926.5000 or at http://www.broadcom.com.
Cautions regarding Forward Looking Statements:
All statements included or incorporated by reference in this release, other than statements or characterizations of historical fact, are forward-looking statements. These forward-looking statements are based on Broadcom's current expectations, estimates and projections about our industry and business, management's beliefs, and certain assumptions made by us, all of which are subject to change. Forward-looking statements can often be identified by words such as "aims," "anticipates," "becoming," "expects," "intends," "plans," "predicts," "believes," "seeks," "estimates," "may," "will," "should," "would," "could," "potential," "continue," "ongoing," "targeted" similar expressions, and variations or negatives of these words. Examples of such forward-looking statements include, but are not limited to, references to the anticipated revenue of the DTV business, the expected dilutive impact of the acquisition to our EPS, the anticipated impact and benefits to Broadcom related to its acquisition of AMD's DTV business, and potential accounting charges that may be taken by Broadcom in connection with the acquisition. These forward-looking statements are not guarantees of future results and are subject to risks, uncertainties and assumptions that could cause actual results to differ materially and adversely from those expressed in any forward-looking statement.
Important factors that may cause such a difference for Broadcom in connection with the acquisition of AMD's DTV business include, but are not limited to,
-- unexpected variations in market growth and demand for the DTV products and technologies, -- the risks inherent in acquisitions of technologies and businesses, including the timing and successful completion of technology and product development through volume production; -- integration issues; -- costs and unanticipated expenditures; -- changing relationships with customers, suppliers and strategic partners; -- potential contractual, intellectual property or employment issues; -- the risk that anticipated benefits of the acquisition may not be realized; and -- accounting treatment and charges.
Additional factors that may cause Broadcom's actual results to differ materially from those expressed in forward-looking statements include, but are not limited to, those listed at http://www.broadcom.com/press/additional_risk_factors/Q32008.php.
Our Annual Report on Form 10-K, subsequent Quarterly Reports on Form 10-Q, recent Current Reports on Form 8-K, and other Securities and Exchange Commission filings discuss the foregoing risks as well as other important risk factors that could contribute to such differences or otherwise affect our business, results of operations and financial condition. The forward-looking statements in this release speak only as of this date. We undertake no obligation to revise or update publicly any forward-looking statement, except as required by law.
Broadcom(R), the pulse logo, Connecting everything and the Connecting everything logo are among the trademarks of Broadcom Corporation and/or its affiliates in the United States certain other countries and/or the EU. Any other trademarks or trade names mentioned are the property of their respective owners.
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