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Broadcom acquires Altima
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July 31, 2000: 9:56 a.m. ET
Semiconductor firm pays $533M in stock for high-performance chip maker
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NEW YORK (CNNfn) - Looking to boost its sales to small- and medium-sized businesses, semiconductor maker Broadcom Corp. agreed Monday to acquire Altima Communications Inc. for $533 million in stock.
The deal will significantly expand Broadcom's ability to produce computer chips, switches and hubs for small- and mid-sized businesses, a market that is expected to grow by more than 100 percent this year, according to Dell'Oro Group, a market research group. Altima makes low-power, high-performance integrated circuits geared especially for use in businesses that size.
The agreement also gives the Irvine, Calif.-based Broadcom, a leading provider of chips that provide voice, data and wireless communications, an improved foothold in Asia, where a majority of Altima's customers are located.
Terms of the transaction call for Broadcom (BRCM: Research, Estimates) to issue roughly 2.5 million of its common shares to purchase Altima, based in San Jose, Calif. The companies hope to close the acquisition within 60 days.
 Broadcom expects to record an undisclosed, one-time charge for "purchased in-process research and development expenses related to the acquisition" during the third quarter.
The deal extends a prolonged shopping spree by Broadcom, which has taken advantage of its high-priced stock to spend more than $1 billion on acquisitions recently. The company plans to expand beyond its current product line and create seamless, multi-media networks.
Just last month, the company closed a deal to purchase wireless chip maker Innovent Systems Inc. for $440 million in stock.
Broadcom shares shed 2-3/16 to 210-7/8 in early trading Monday. 
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