Telecompaper

NXP Semiconductors has agreed to sell its TV and set-top box business to Trident Microsystems in exchange for a 60 percent stake in the company. As part of the deal, NXP has agreed to buy 6.7 million new shares in Trident, at USD 4.50 per share, giving Trident a cash injection of USD 30 million. Including the NXP product lines, Trident will have revenues of USD 500 million this year, of which 60 percent for TV products and 40 percent from set-top boxes. Upon closing, Trident will have an extensive portfolio of consumer IP applicable to a range of markets, with over 2,000 granted and in-process patents including motion estimation/motion compensation and conditional access, as well as advanced 45nm SoC technology. Trident estimates the entire digital home semicoductor market to be worth USD 5 billion by 2010. While based in California, Trident expects to retain a core set of technology centres of excellence in Europe and North America, while growing and leveraging its own and NXP's engineering presence in Asia. Trident will be fabless and will have the ability to access manufacturing capacity from NXP's manufacturing facilities, as well as the partner foundries and subcontractors of both companies. It will continue to support the existing customers and design wins of each company. NXP's shares in the company will be subject to a two-year locak-in period. Sylvia Summers will remain the CEO of Trident and Christos Lagomichos, EVP of NXP's Home business unit, will become president. Pete Mangan will remain senior vice president and chief financial officer of Trident. In addition, NXP and Trident intend to cooperate in the development of products in other selected high-growth technology areas, including NXP's car entertainment and silicon tuner product lines. The transaction is subject to the approval of the stockholders of Trident, consultations with employee representatives and regulatory approvals. The transaction is expected to close in the first quarter of 2010. Trident forecast revenues of USD 140-160 million in the first quarter after closing, to 30 June 2010, and expects to break even on a non-GAAP operating basis as early as the end of calendar year 2010.