NXP sells unit before Freescale buy
Dutch chipmaker selling radio-frequency power-amplifier unit.
Ahead of its purchase of Austin-based Freescale Semiconductor, Dutch chipmaker NXP Semiconductors NV is selling its radio-frequency power-amplifier unit to a Chinese partner for $1.8 billion.
The sale is part of a bid to avoid NXP getting a too high market share in communication chips after the Freescale takeover, Joon Knapen, an NXP spokesman, told Bloomberg News. About 2,000 workers will transfer to the new owner, China’s stateowned Jianguang Asset Management Co.
“The creation of a new company focused on the RF power amplifier market is a groundbreaking transaction for JAC Capital and a great deal for our customers,” NXP CEO Richard Clemmer said in a securities filing. “Although we would have expected a higher valuation in a regular disposal, JAC Capital’s ability to support continued growth and development of the business and its ability to sign and close a transaction rapidly was a key factor in enabling the best outcome for our customers and shareholders, as well as supporting the closure of the merger with Freescale Semiconductor.”
All relevant patents and in- tellectual property associated with the RF power business will be transferred in the sale, as well the NXP back-end manufacturing operation in the Philippines. The sale is expected to close in the second half of this year.
“We are happy to reach an agreement to acquire the RF Power business from NXP with its strong team and established technology. We will keep on increasing invest-
ment in R&D, manufacturing and customer service of the new company to strengthen its market position,” said Brighten Li, chairman of JAC Capital Investment Evaluation Committee.
NXP announced in March that it planned to acquire Freescale in an $11.8 billion merger deal, which is expected to close in the second half of this year.
That sent ripples through the semiconductor industry, especially in Austin, where Freescale employs about 5,000 people.
Freescale provides computer chips to facilitate embedded processing in a wide array of products, from traditional computing pl atforms to home appliances and automobiles.