Tundra Semiconductor Corp. has acquired Silicon Logic Engineering Inc., a developer of communications and computer chip products, for USD 14 million to strengthen its systems interconnect for the communications and computing markets.
Under the terms of the agreement, the purchase price is comprised of USD 10 million in cash and USD 4.0 million i.e., about 259,000 common shares of Tundra. Half of the share consideration will be payable over the next two years depending on certain operational objectives, Tundra said.
"This acquisition fulfills a key element of our strategy: by combining SLE’s skills with our existing IP and customer relationships we will expand our product portfolio and broaden the range of applications we can address," said Jim Roche, President and CEO of Tundra.
Tundra expects the acquisition to generate revenues through design services and IP licensing. The SLE business is expected to generate revenues in the range of USD 2.0 to USD 2.3 million per quarter, with gross margins of between 35% and 40% and profit after tax of between 10% and 12% of revenues.
Founded in 1996 and with roots in the supercomputer industry, SLE is a private company with over forty employees.
