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Infineon to pay €100m for ADSL chip maker

Acquires Taiwan's ADMtek

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Infineon today announced a plan to buy Taiwanese fabless comms chip maker ADMtek for up to €100 million - €80 million now and a further €20 million if the acquisition meets two-year performance targets set by its buyer.

ADMtek focuses on Ethernet chipsets, but Infineon is more interested in its WLAN and home broadband gateway products. The German company sees ADMtek's products as a way of boosting its own income from the ADSL and VoIP markets. Until the acquisition is completed, it has no consumer-oriented home gateway chip offerings.

ADMtek will form the basis of a new firm, Infineon-ADMtek, also based in Hsinchu, Taiwan.

The acquisition - Infineon's first in Asia - provides it with a strong R&D centre, favourable cost structure and close proximity to Taiwanese ODMs, which account for more than 70 per cent of the global consumer broadband modem and router market. It is also near many of the world's fastest growing broadband markets, such as China and Japan.

ADMtek is privately owned. Its largest shareholder is Accton Technology Corporation, which is one of said Taiwanese ODMs. Under the terms of the acquisition, Infineon has agreed to continue to supply chips to Accton. ®

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