NEWPORT BEACH, Calif.-Semiconductor provider Conexant Systems Inc. made a series of major announcements, including a merger with Alpha Industries Inc., the separation of its business into three companies and improved sales for the first quarter.
Conexant said it would merge with Alpha, which provides radio-frequency integrated circuit-based products for the wireless and broadband markets, to create a company valued at about $3 billion. The new company, which will be spun off and renamed, will have about 4,000 employees worldwide. Conexant said the new company will drive the RF integration of all major air interfaces, including CDMA and GSM, and work on semiconductor and software products for 2.5- and third-generation networks.
In a related announcement, Conexant said it would divide its business into three independent, publicly traded companies. Conexant and Alpha will be spun off into a mobile communications company when the merger is complete, which is expected during the second quarter of next year, while the rest of Conexant’s business will be separated into broadband access and Internet infrastructure companies. Conexant’s Internet infrastructure business will be spun off when market conditions improve, the company said.
Conexant also said it expects its revenues for the first quarter to be about 10 percent over the $201 million the company reported in the previous quarter. The company said its improved sales are primarily due to its wireless communications division.
Conexant’s stock jumped following the news by about $1.50 per share, from just under $16 to about $17.50 per share.
