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Analyst: ADI may sell wireless chip biz to MediaTek

Posted: 13 Jul 2007     Print Version  Bookmark and Share

Keywords:wireless chip unit  ADI division  acquisition report 

Reports have unwrapped that Analog Devices Inc.'s wireless chip business is up for sale, and Taiwan's MediaTek Inc. is said to be the likely buyer.

''The Economic Daily Newspaper of Taiwan is speculating that MediaTek may acquire Analog ('ue'?) Device's wireless chipset division,'' said analyst Doug Freedman of American Technology Research, in a report. ''In addition to MediaTek, we believe other likely buyers could emerge including homegrown China-based fabless companies backed by the government.''

MediaTek is a major supplier of consumer and communications ICs. It is a big player in the China market.

''The acquisition would make strategic sense for MediaTek as the company would gain a leg-up on entering the 3G TD-SCDMA mobile market in China,'' he said. ''We believe it is prudent for ADI to sell the wireless division ahead of the impending volume ramp in China as 3G equipment is deployed. We believe competition will emerge as a result of the ramp and challenge the segment's profitability for all but the lowest cost providers.''

In the segment, ADI makes chipsets, power management and amplifiers for handset manufacturers, wireless base stations and networking equipment and modem suppliers.

''We believe the segment was likely losing money and ADI has underinvested in R&D for some time,'' Freedman said.

- Mark LaPedus
EE Times




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