IPTV SoC Company, Sigma Designs, to Acquire Home-Networking Chipmaker, CopperGate

Sigma Designs, a provider of system-on-a-chip (SoC) solutions for IPTV set-top boxes and consumer electronics, announced Wednesday that it has reached a definitive agreement to acquire CopperGate, a Tel Aviv-based company that provides Silicon-based modem solutions for distributing broadband digital content in the home over coax, phone and power lines. The cash and stock deal, which has been approved by both companies' boards, values CopperGate, which also maintains operations in the US and Taiwan, at $160 million.

According to Sigma Designs, the combination of the two companies creates a "leading provider of networked home entertainment semiconductor solutions." The companies have "highly complementary" technology platforms, it says, which together form a "portfolio of end-to-end solutions." In addition, it claims that the transaction will expand its footprint with key customers, as well as enabling cross-selling opportunities. "Sigma is committed to offering superior semiconductor solutions for the networked home entertainment market and our acquisition of CopperGate's leading home and MDU solutions further strengthens our opportunities in this market," CopperGate CEO, Thinh Tran, said in a prepared statement. "Having developed three generations of ITU/HomePNA IC's since 2005, with over 12 million IC's shipped, CopperGate has proven itself a leader in the IPTV market. From Sigma's perspective, we believe that the acquisition of CopperGate provides substantial benefits to our existing business while positioning our combined company to offer superior value solutions for the future. We believe it will enhance the breadth of our technology so that we extend our position as a world-class provider of complete home entertainment chipset solutions for all forms of media processing and communications. By combining forces, we are able to launch a more comprehensive set of solutions and capitalize on a broader range of market opportunities."

Sigma says that the combination of the two companies is expected to yield several potential synergies, including synergies from leveraging manufacturing know-how and combined wafer sourcing, further SoC integration and combined R&D.