Switch and storage technology vendor Vitesse Semiconductor Corp. is acquiring integrated circuit maker Cicada Semiconductor Inc. in a deal worth US$66 million in cash.
In an announcement last Monday, Camarillo, Calif.-based Vitesse said it's buying Austin-based Cicada to give customers a more diverse and compelling product range, while increasing its market share.
Lou Tomasetta, president and CEO of Vitesse, said in a statement that the merger is a natural combination for the companies.
"Vitesse and Cicada have been jointly selling gigabit speed switch solutions for over a year, comprised of Vitesse's LAN switches and Cicada's Gigabit Ethernet copper transceivers," he said. "The combined companies will now offer best in class switches with the highest levels of integration and the lowest power gigabit transceivers. We expect this acquisition to double our revenues in the LAN switch market and to position us to gain share as the market embraces gigabit switch products."
The deal, which is subject to approval by Cicada stockholders, is expected to close in the first quarter of 2004.
About 40 Cicada employees, most of whom work on product development, will lose their jobs because of the merger, according to the companies.