STM's $3B Mobile Chip Biz
The new company will cover a broad swathe of mobile technologies within its portfolio. Between the two operations, the firms can boast 2G and 3G cellular products, WiFi, ultrawideband (UWB), location technology, and more. (See NXP to Buy Location Smarts for $85M.) The company says that it will be positioned to take on the expanding UMTS market as well as the emerging 3G Chinese standard and other wireless technologies. The new venture will combine design, sales and marketing, and back-end manufacturing assets from both companies into a worldwide joint venture that will use its parent companies for chipmaking. NXP is originally an off-shoot from Dutch giant Royal Philips Electronics N.V. (NYSE: PHG; Amsterdam: PHI) Private equity firms purchased the majority of Philips Semiconductors (NYSE: PHG) in August 2006 for around $10 billion to create NXP, making STMicro's price for its majority stake look like a bargain. Downward price pressure is affecting all the key players in the wireless chip business.
— Dan Jones, Site Editor, Unstrung