IRVINE, Calif. and SAN JOSE, Calif., July 12, 2007 -- Broadcom Corporation (Nasdaq: BRCM), a global leader in semiconductors for wired and wireless communications, today announced that it has completed the acquisition of Global Locate, Inc., a privately-held, fabless provider of industry-leading global positioning system (GPS) and assisted GPS (A-GPS) semiconductor products and software.
GPS products and location based services (LBS) are increasing in popularity with consumers and cellular service providers as both take advantage of the ability to identify exact geographical location by means of faint radio signals transmitted from a system of orbiting satellites. Growing consumer interest in these applications is driving the GPS chip market, which is expected to grow to $1.07 billion annually by 2012 according to market research firm Forward Concepts. Combining Global Locate's GPS technology with Broadcom's leading Bluetooth(R), Wi-Fi(R), cellular and other mobile technologies will provide leading handset makers with wireless connectivity solutions that add significant value to feature and smart phone products.
In connection with the acquisition, Broadcom paid approximately $143 million in cash in exchange for all outstanding shares of capital stock and other rights of Global Locate. A portion of the consideration payable to the stockholders of Global Locate was placed into escrow pursuant to the terms of the acquisition agreement. Additional consideration of up to $80 million in cash will be reserved for future payment to the former holders of Global Locate capital stock and other rights upon satisfaction of certain future performance goals. In connection with the transaction, certain former stockholders of Global Locate are purchasing $3 million of restricted shares of Broadcom's Class A common stock at today's closing price on the Nasdaq Global Select Market. Broadcom may record a one-time charge for purchased in-process research and development expenses related to the acquisition in its current fiscal quarter, ending September 30. 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 products enable the delivery of voice, video, data and multimedia to and throughout the home, the office and the mobile environment. We provide 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 our core mission: Connecting everything(R).
Broadcom is one of the world's largest fabless semiconductor companies, with 2006 revenue of $3.67 billion, and holds over 2,000 U.S. and 800 foreign patents, more than 6,000 additional pending patent applications, and one of the broadest intellectual property portfolios addressing both wired and wireless transmission of voice, video and data.
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 www.broadcom.com.
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995:
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 our 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 "anticipates," "expects," "intends," "plans," "predicts, " "believes," "seeks, " "estimates," "may, " "will," "should," "would," "could," "potential," "continue" "ongoing," similar expressions, and variations or negatives of these words. These forward-looking statements are not guarantees of future results and are subject to risks, uncertainties and assumptions that could cause our 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 Global Locate, Inc. include, but are not limited to, 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, accounting treatment and charges, and the risk that anticipated benefits of the acquisition may not be realized; general economic and political conditions and specific conditions in the markets we address, including the volatility in the technology sector and semiconductor industry, trends in the broadband communications markets in various geographic regions, including seasonality in sales of consumer products into which our products are incorporated, and possible disruption in commercial activities related to terrorist activity or armed conflict in the United States and other locations; the rate at which our present and future customers and end-users adopt Broadcom's technologies and products in the markets for mobile computing applications; delays in the adoption and acceptance of industry standards in those markets; the timing, rescheduling or cancellation of significant customer orders and our ability, as well as the ability of our customers, to manage inventory; the gain or loss of a key customer, design win or order; our ability to scale our operations in response to changes in demand for our existing products and services or demand for new products requested by our customers; our ability to specify, develop or acquire, complete, introduce, market and transition to volume production new products and technologies in a cost-effective and timely manner; intellectual property disputes and customer indemnification claims and other types of litigation risk; the quality of our products and any remediation costs; our ability to timely and accurately predict market requirements and evolving industry standards and to identify opportunities in new markets; problems or delays that we may face in shifting our products to smaller geometry process technologies and in achieving higher levels of design integration; our ability to retain, recruit and hire key executives, technical personnel and other employees in the positions and numbers, with the experience and capabilities, and at the compensation levels needed to implement our business and product plans; the risks and uncertainties associated with our international operations; competitive pressures and other factors such as the qualification, availability and pricing of competing products and technologies and the resulting effects on sales and pricing of our products; the timing of customer-industry qualification and certification of our products and the risks of non-qualification or non-certification; changes in our product or customer mix; the volume of our product sales and pricing concessions on volume sales; the availability and pricing of third party semiconductor foundry, assembly and test capacity and raw materials; fluctuations in the manufacturing yields of our third party semiconductor foundries and other problems or delays in the fabrication, assembly, testing or delivery of our products; the risks of producing products with new suppliers and at new fabrication and assembly facilities; the effectiveness of our expense and product cost control and reduction efforts; the effects of natural disasters, public health emergencies, international conflicts and other events beyond our control; the level of orders received that can be shipped in a fiscal quarter; and other factors.
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 for any reason.
Broadcom(R), the pulse logo, Connecting everything(R), the Connecting everything logo, Global Locate(R) and Hammerhead(R) are among the trademarks of Broadcom Corporation and/or its affiliates in the United States, certain other countries and/or the EU. Bluetooth(R) is a trademark of the Bluetooth SIG. Wi-Fi(R) is a trademark of the Wi-Fi Alliance. Any other trademarks or trade names mentioned are the property of their respective owners.
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SOURCE Broadcom Corporation; BRCM Mobile and Wireless