World News: Broadcom to acquire Global Locate for $146m

World News:  Broadcom to acquire Global Locate for $146m

Broadcom has signed a definitive agreement to acquire Global Locate, a privately-held fabless provider of GPS and A-GPS semiconductor products and software.

Broadcom expects to pay approximately $146 million in cash at closing in exchange for all outstanding shares of capital stock and other rights of Global Locate. An additional cash payment of up to $80 million will be reserved for future payment to the former Global Locate stockholders, dependant on satisfaction of certain performance goals.

Both companies’ boards of directors have approved the merger, which remains subject to customary closing conditions.

With cellular service providers exploiting the ability of GPS-enabled devices to pinpoint geographical location, and the latest generation of PNDs also featuring POIs and turn-by-turn navigation, consumer interest in these applications is increasing. Cellular service providers also plan to incorporate GPS chips in mobile phones to meet government regulations for emergency 911 calls. All of these applications are driving the GPS chip market, which is expected to reach $1.07 billion a year by 2012 (according to market research firm Forward Concepts).

Combining Global Locate's GPS technology with Broadcom's Bluetooth, Wi-Fi®, cellular and other mobile technologies will provide leading handset makers with wireless connectivity solutions that add significant value to smart phone products.

Global Locate's semiconductor solutions are used in mobile phones from leading cellular handset makers and incorporated into TomTom products. The company is currently producing its third generation of GPS chips, and has developed a worldwide GPS reference network that provides assistance data to its A-GPS-equipped chips via cellular data channels (GPRS or 3G), boosting performance and reducing the time required to determine a location by up to 100 times.

"With the acquisition of Global Locate, Broadcom will be the only semiconductor supplier in the world with top-tier customers in Bluetooth, Wi-Fi, FM radio and GPS, four of the key wireless technologies now being added to next generation mobile phones," said Robert Rango, senior vice president & general manager of Broadcom's Wireless Connectivity Group, adding that Global Locate's 175+ issued and pending US and foreign patents will be added to Broadcom’s patent portfolio.

The acquisition also includes Global Locate's World Wide Reference Network (WWRN) providing real-time A-GPS data as well as Long-Term Orbit (LTO) solutions to provide assistance even when a network connection is not available.

The boards of directors of both companies have approved the merger, which remains subject to customary closing conditions.

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