Light Reading

Rumor: Is Broadcom Buying Agere?

Light Reading
News Analysis
Light Reading
10/4/2004
50%
50%
Repost This

Agere Systems Inc. (NYSE: AGR.A) stock is getting a boost today from rumors that Broadcom Corp. (Nasdaq: BRCM) is considering an acquisition of the troubled chip firm.

A Broadcom acquisition seems to be a longshot bet, but it was enough to push Agere's stock up $0.18 (17 percent) to $1.26 by this afternoon.

Agere participates in a few markets that Broadcom doesn't, most notably chips for hard disk drives. And Agere could push Broadcom further into the telecom space with physical-layer chips, network processors, and switch fabrics. But Agere also overlaps Broadcom in two areas where Broadcom doesn't need much help: cell phone chips and wireless LANs.

Overall, analysts don't see much reason for Broadcom to absorb a company with a $2 billion market capitalization and a recent history of struggles. Agere is on the defensive, having disappointed in consecutive quarters due in part to a 3G handset rollout that just refuses to happen (see Agere Suffers Hutch Hiccup and Agere Stung by 3G (Again)).

A merger "would not make sense from the financial point of view, in terms of the impact it would have on Broadcom's valuation," says Dushyant Desai, an analyst with CE Unterberg Towbin. "It's better for Broadcom to compete with and maybe displace Agere."

Analysts were cheered recently by Agere's initiation of some cost-cutting efforts. Agere recently announced it would cut 500 jobs from its roster of 6,600. Another 600 will go if a buyer can't be found for Agere's Orlando fab, which the company pledges to close by the end of December 2005 (see Agere Wields Jobs Axe). Agere separately plans to close offices in Maine, New Jersey, and the Netherlands.

— Craig Matsumoto, Senior Editor, Light Reading




For more info on the state of industry financials, check out the coming Light Reading Live! event:



(6)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View
cyber_techy
50%
50%
cyber_techy,
User Rank: Light Beer
12/5/2012 | 1:12:44 AM
re: Rumor: Is Broadcom Buying Agere?

<bold>
<italics>
Analysts were cheered recently by Agere's initiation of some cost-cutting efforts. Agere recently announced it would cut 500 jobs from its roster of 6,600.
</italics>
</bold>


How callous!! Hope they can be cheered just as easily when they lose their own jobs.

Welcome to capitalism
deauxfaux
50%
50%
deauxfaux,
User Rank: Light Beer
12/5/2012 | 1:12:44 AM
re: Rumor: Is Broadcom Buying Agere?
One of the two is a very smart guy, the other one should be washing the Ferraris in the parking lot. Heaven help the Broadcom guys if this is his idea.
big_daddy_cool
50%
50%
big_daddy_cool,
User Rank: Light Beer
12/5/2012 | 1:12:42 AM
re: Rumor: Is Broadcom Buying Agere?
So which was is the Ferrari owner and which one is the washer? FT or BR?
waverunner
50%
50%
waverunner,
User Rank: Light Beer
12/5/2012 | 1:12:41 AM
re: Rumor: Is Broadcom Buying Agere?
This is more than a rumour, insiders at Agere have been buying heavily for the last two months, expect a 2.50/share offering. A 2B offering for 1B+ sales per year company is quite reasonable.

W
deauxfaux
50%
50%
deauxfaux,
User Rank: Light Beer
12/5/2012 | 1:12:40 AM
re: Rumor: Is Broadcom Buying Agere?
I am sure that ultimately, he will do for Broadcom what he did with the Modem Biz
Big Time
50%
50%
Big Time,
User Rank: Light Beer
12/5/2012 | 1:12:39 AM
re: Rumor: Is Broadcom Buying Agere?
Not sure I see the math straight on this. With roughly 1.7B shares outstanding, doesn't that price a 2.50 offering at ~4.25B?
Flash Poll
LRTV Custom TV
Maximizing Customer Experience & Assuring Service Delivery in an IP World

4|15|14   |   4:57   |   (0) comments


Steven Shalita, VP of Marketing, NetScout Systems, Inc., discusses the challenges cable/MSO operators face in assuring the delivery of new IP-based services. Key points include the value of proactively managing performance, and using rich analytics and operational intelligence to better understand service and usage trends, make smarter business decisions and ...
LRTV Documentaries
Bye-Bye DVD: Consumers Embrace Digital Video

4|10|14   |   04:17   |   (6) comments


Veteran video analyst Colin Dixon, founder and principal analyst of nScreenMedia, says research shows 56% are using digital video already.
LRTV Documentaries
Video: TW Cable Puts Multicast Gateways to the Test

4|8|14   |   04:13   |   (1) comment


Tom Gonder, a chief architect at Time Warner Cable, explains how its trial of multicast gateways is impacting IP-based video plans.
LRTV Custom TV
Managing & Monetizing Big Data in Operator Environments

4|7|14   |     |   (1) comment


At Mobile World Congress, Gigamon's Director of Service Provider Solutions, Andy Huckridge, and Heavy Reading Analyst Sarah Wallace discuss the 'big data' issues facing carriers and operators today.
LRTV Huawei Video Resource Center
Data Center Energy – Build Your Data Center in a Modular Way

4|7|14   |   2:13   |   (0) comments


Dr. Fang Liangzhou, VP Network Energy Product Line, shared his thoughts about the challenges for data centers during CeBIT 2014.
LRTV Huawei Video Resource Center
Agile Network Solution – An Overview of Huawei's Agile Network Solution

4|7|14   |   2:31   |   (0) comments


Ajay Gupta, Director of Product Marketing, Networking Product Line, gives an overview of the Agile Network Solutions during CeBIT 2014.
LRTV Huawei Video Resource Center
Huawei’s eLTE Voice Trunking, Video and Data Applied for Railways

4|7|14   |   1:38   |   (0) comments


Gottfried Winter is the Sales Director at Funkwerk, a German specialist in GSM-r terminals and a long-time partner of Huawei. At CeBIT 2014, Winter talks to Light Reading about this partnership and the integration of enhanced voice trunking, video and data functions.
LRTV Huawei Video Resource Center
LeaseWeb Speaks Highly of Huawei's Datacenter Products

4|7|14   |   1:37   |   (0) comments


Rene Olde Olthof, Operations Director LeaseWeb, talks about the next data center transformation during CeBIT 2014.
LRTV Documentaries
Comcast: Reshaping the Cable Network Architecture

4|3|14   |   07:11   |   (8) comments


Shamim Akhtar, Comcast's architect and senior director of network strategy, explains why the cable company is moving to a more distributed network architecture.
LRTV Custom TV
VMware CEO Pat Gelsinger at Mobile World Congress

4|1|14   |   3:41   |   (0) comments


VMware CEO Pat Gelsinger speaks to Heavy Reading about the value of virtualization spanning from the data center to service provider networks to mobile devices.
LRTV Huawei Video Resource Center
Analysts' Impressions of Huawei SoftCOM at ONS 2014

4|1|14   |   1:11   |   (0) comments


After visiting the Huawei booth at ONS, Lee Doyle of Doyle Research gives his appraisal of Huawei's SoftCOM solution.
LRTV Huawei Video Resource Center
Analysts' Impressions of Huawei SoftCOM at ONS 2014

4|1|14   |   1:26   |   (0) comments


After visiting the Huawei booth at ONS, Rick Talbot of Current Analysis gives his appraisal of Huawei's SoftCOM solution.
Hot Topics
China's Innovation Deficit
Robert Clark, 4/9/2014
Businesses Face 'Fiber Gap': Report
Dan O'Shea, Managing Editor, 4/9/2014
BlackBerry's Chen: We're Not Dumping Devices
Dan Jones, Mobile Editor, 4/10/2014
AT&T's Going to Carolina With 1 Gig
Sarah Reedy, Senior Editor, 4/10/2014
Cisco, Juniper Treating Gear Against Potential Heartbleed
Dan O'Shea, Managing Editor, 4/11/2014
Like Us on Facebook
Twitter Feed