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Broadcom gets Innovent
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June 13, 2000: 4:27 p.m. ET
Semiconductor maker buys wireless communications firm for $440 million
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NEW YORK (CNNfn) - Semiconductor manufacturer Broadcom Corp. agreed Tuesday to acquire Innovent Systems Inc. for approximately $440 million in stock, significantly boosting the company's push to provide short-range communications between wireless digital devices.
Broadcom, a leading producer of integrated circuits that allow high-speed communications via digital subscriber lines, satellites and home networking systems, said Innovent's Bluetooth chips would provide a significant foothold in the wireless-to-wireless communications market, which some analysts estimate will become a multibillion-dollar industry within the next few years.
The Irvine, Calif.-based Broadcom already owns a roughly 13 percent stake in Innovent, which it has supported with seed money since Innovent's inception early last year.
"This acquisition is indicative of Broadcom's ability to identify and support high-potential early-stage enterprises ... working on leading edge technology and products for high-growth markets," said Henry Nicholas III, Broadcom's president and chief executive officer, adding that "demonstrates Broadcom's intention to be a formidable competitor wireless markets worldwide."
The deal calls for Broadcom (BRCM: Research, Estimates) to exchange 3 million of its common shares for Innovent. Based on Broadcom's closing price of 146-11/16 Monday, the deal values Innovent at just more than $440 million.
 But shareholders, who have already shaved more than 42 percent off Broadcom's 52-week high of $253 per share set in March, appeared less than enthusiastic about the deal, pushing the company's shares down 3-11/16 to 143 by mid-afternoon.
El Segundo, Calif.-based Innovent's products allow communications between personal digital assistants, cell phones and/or personal computers.
The acquisition prolongs Broadcom's relentless shopping spree of more than $1 billion since the beginning of last year to beef up its technology base. The deal for Innovent follows last month's $242.5 million acquisition of Pivotal Technologies, which makes integrated circuits that connect home digital devices. 
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Broadcom Corp.
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