Title In $2.5B Deal, Qualcomm & CSR Mesh
Date   2014-10-21                                           

Memo
In $2.5B Deal, Qualcomm & CSR Meshs

 Qualcomm Inc., the world``s largest cellphone chip vendor, has agreed to buy CSR for ?1.57 billion ($2.5 billion) to strengthen its presence in the Internet of Things. CSR, a pioneer in short-range Bluetooth-based wireless connectivity, develops voice and audio processing tools used in portable, automotive, and wearable devices. Most recently, it devised CSRmesh, a Bluetooth-based mesh technology described by some observers as a potential ZigBee killer. Qualcomm would pay 900 pence ($14.37) a share for CSR, a 56.5% premium on the share price before the start of the offer period in August. The all-cash offer was announced Wednesday just hours before a deadline imposed by UK regulators for Microchip Technology to mount a fresh bid for CSR. In August, Microchip disclosed that it was negotiating a deal with CSR. However, CSR rejected Microchip``s overtures, saying its offer was too low. (That price was not disclosed.) Qualcomm``s $2.5 billion offer could trigger other bids for CSR, now that a firm price is out in the open. However, financial analysts appear to believe that only a handful of semiconductor companies could afford to complete with Qualcomm.
<Qualcomm looks beyond mobile?>
"The offer was unexpected because Qualcomm acquired connectivity technology through the 2011 acquisition of Atheros." However, Atheros`` technology has mainly been embedded in mobile handsets alongside Qualcomm``s radio and processor solutions. "With growth in the smartphone market running out of steam, Qualcomm needs to look for new avenues of growth, and CSR provides this connectivity technology for the plethora of devices which require connectivity to participate in the ``internet of things`` mega trend. CSR``s indoor location technology may also be of interest."


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