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SigmaTel to Acquire Protocom to Boost Multimedia Capabilities
AUSTIN, Texas--(BUSINESS WIRE)--July 26, 2005--SigmaTel Inc. (NASDAQ:SGTL), a global leader in analog intensive, mixed-signal integrated circuits for the portable consumer electronics and computing markets, today announced that it has signed a definitive agreement to acquire Protocom Corporation, a privately held provider of semiconductors to the multi-function imaging market. In addition to providing key technologies applicable to SigmaTel's core audio business, the $47 million acquisition will give SigmaTel its first product line focused on imaging applications, as well as provide technology that can be leveraged into several emerging multimedia consumer electronics markets.
Imaging technology is essential to meet the feature requirements of next-generation portable multimedia devices, and SigmaTel's contemplated acquisition of Protocom is the result of long-term research that substantiated Protocom's delivery of the industry's best solutions for portable image acquisition, compression/decompression and display.
Protocom launched the world's first full-duplex MPEG-4 Advanced Simple Profile (ASP) hard-wired semiconductor product and provides high-performance solutions to the top-tier players in the consumer electronics market, including Samsung. Protocom's GoldenREEL(TM) PR818S offers high-quality video in highly mobile, ultra-small environments typical of compact digital video cameras and other portable multimedia devices. In these applications, high-quality image capture, sound recording and playback, and video display, as well as long battery life, are key consumer requirements. With its ARM9 core, the GoldenREEL(TM) is the centerpiece of Emerge(TM), Protocom's development platform, which delivers a complete solution designed to help OEMs reduce time to market.
"We are dedicated to a strategy of ongoing product diversification," said SigmaTel President and CEO Ron Edgerton. "SigmaTel commits to new market segments when we have compelling technology and a strong business plan that justifies investing in new products for those markets. The market for portable multimedia devices is growing and video is becoming more important to the markets we serve. As we look toward introducing a new generation of multimedia chips, the features, flexibility and greater ease of implementation brought by Protocom are key parts of our strategy to broaden SigmaTel's leadership in the portable multimedia SoC market."
The acquisition of Protocom increases SigmaTel's technology portfolio and its architecture and system design capabilities to meet the form, fit and function requirements for devices such as digital video cameras, personal media players (PMPs), video conferencing, remote security cameras, digital still cameras and multimedia mobile phones. Protocom's patent-pending implementation of MPEG-4 ASP enables MPEG-4 images to be compressed into approximately one-fifth the storage space of other MPEG formats with virtually no impact on image quality. As a result, the Protocom solution offers greater battery life and helps lower the amount of needed memory, one of the highest cost elements for portable media devices, offering the potential for SigmaTel to deliver more cost-effective portable media devices and help accelerate market growth.
