Intel forks out $US748 million for Xircom

Intel forks out $US748 million for Xircom

It remains business as usual within Xircom's Australian and New Zealand operations, despite Intel's announcement last week that it will purchase the PC and networking card vendor in a $US748 million deal.

Intel announced it had entered into a definitive agreement to acquire Xircom for $25 per share as approved by Xircom's board of directors. When the deal is completed, believed to be in around eight week's time, Xircom will become a wholly owned subsidiary of the chip giant as part of its network communications group.

Although it's still early days for the deal, Jeremy Fox, Xircom's newly appointed country manager, says he is confident the buyout will strengthen the company's presence in the market.

"As far as the company is concerned, Xircom will continue to be a separate entity even when the deal is consummated," he said. "The issue for our resellers is that Xircom's channel will continue to get the same loyalty and support of its products and it is going to be business as usual."

Fox had just been appointed country manager for Australia and New Zealand when Intel and Xircom brokered the deal. He is no stranger to company takeovers though, having been through the ICL-Fujitsu takeover and that of Bellsouth and UIH. But he maintains the synergy between the companies will work as an advantage to both.

Xircom provides a range of products for mobile PC users, including Real Port and RealPort2 Integrated PC Cards, Credit Card PC Cards and CompactCards for Pocket PCs as well as NetStation conference room networking and handheld solutions.

"They [Intel] don't have products that are directly in our channel, nor do we have [any] in theirs," Fox said. "This is a situation where they are not in our market space, nor are we in theirs, so it really should be an excellent relationship when it comes together."

It is likely Xircom will retain Xircom staff within Australia. It will also assume all existing vested and unvested employee options under the deal.

"They made it clear that they want the people. They want the channel and they want what Xircom brings to the table - its products, its people and its routes to market."

New products

"As far as we are all concerned, it is business as usual," Fox continued. "All the products are the same, plus some new ones we are introducing this year in the wireless space. We still have a very strong focus in going forward in wireless this year."

The company will release the Rex 6000 micro PDA device with touch screen and stylus for data entry.

"We call it wearable information because it really does fit in your pocket. All those things are coming and I think Intel will strengthen that.

"Intel has made it clear that it sees the value of Xircom and its people," Fox added.

Photograph: Xircom country manager Jeremy Fox.

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