Broadcom (BRCM) Upgrades Fiber Portfolio with BroadLight Acquisition

Broadcom Corporation (NASDAQ:BRCM) announced today that they have boosted their “fiber access” portfolio with a definitive agreement for the acquisition of BroadLight, Inc.

BroadLight, a Delaware corporation, is a privately-held provider of networking and fiber access PON (passive optical network) processors.  BroadLight also boasts an Israeli-based subsidiary.  Broadcom hopes to expand its next-gen broadband portfolio of technologies with the acquisition.

Broadcom released the following comment regarding today’s pickup of BroadLight, “The need for increased bandwidth for IPTV services, HDTV broadcasting and high speed Internet access are driving momentum for deploying fiber networks,” said Dan Marotta, Executive Vice President and General Manager of Broadcom’s Broadband Communications Group.

“Combining BroadLight’s PON solutions with the strength of Broadcom’s broadband access portfolio will enable us to offer a complete, end-to-end solution for customers – from OLT at the central office to CPE at the home. BroadLight’s strong engineering team and broad IP will complement and extend our ability to deliver next-generation access technologies to customers.”

The cost for Broadcom to acquire BroadLight is expected to be approximately $195 million dollars to scoop up all outstanding shares of capital stock and additional equity rights.

The nitty-gritty financial bits regarding the acquisition: The cost for Broadcom to acquire BroadLight is expected to be approximately $195 million dollars to scoop up all outstanding shares of capital stock and additional equity rights.  The expenditure for Broadcom is expected to be paid for in cash with the exception of certain unvested employee stock options to be paid in Broadcom restricted stock units.  Additional consideration of up to $10 million in cash will be reserved for future payment to holders of BroadLight capital stock and other rights upon satisfaction of certain performance goals, according to Broadcom.

This deal is expected to go through by Broadcom’s Q2 2012 should nothing go awry.



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