Conexant Sells BB Chip Unit

Conexant Systems has signed a definitive agreement to sell its Broadband Access product lines to Ikanos Communications

April 22, 2009

2 Min Read

NEWPORT BEACH, Calif. -- Conexant Systems, Inc. (NASDAQ:CNXT - News) today announced that it has signed a definitive agreement to sell its Broadband Access product lines to Ikanos Communications, Inc. (NASDAQ: IKAN - News) for $54 million in cash. Conexant’s Broadband Access business provides solutions for DSL, ADSL, VDSL, SHDSL, and PON applications. The transaction, which is subject to customary closing conditions and regulatory approvals as well as approval by Ikanos shareholders, is expected to close in the fourth fiscal quarter.

“Over the past decade, Conexant’s Broadband Access team has developed and delivered an outstanding portfolio of solutions for DSL applications and maintained a leading position in an extremely competitive market,” said Scott Mercer, Conexant’s chairman and chief executive officer. “The combination of Conexant’s and Ikanos’s DSL assets will create a company with the focus, resources, and customer base required to achieve continued success for the foreseeable future.

“The divestiture of our Broadband Access business represents another major step in our efforts to restructure our operations,” Mercer said. “When the transaction is completed this summer, the continuing Conexant will be focused exclusively on providing solutions for imaging, audio, video, and various embedded-modem applications. We occupy leading positions in each of these areas, which are expected to grow over the next several years.

“We expect the continuing Conexant to deliver improved financial performance,” Mercer said. “Proceeds from the transaction will provide us with additional flexibility to make targeted investments to further expand our product portfolio. We also have the option of using some or all of the proceeds to strengthen our balance sheet by retiring debt. As we get closer to completing the transaction, we will provide additional information on the performance we expect from our continuing company.”

Approximately 400 Conexant employees at locations in the United States, India, and China will join Ikanos when the transaction closes. At that time, Conexant’s continuing business will consist of Imaging and PC Media.

Conexant Systems Inc. (Nasdaq: CNXT)

Ikanos Communications Inc. (Nasdaq: IKAN)

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