Qualcomm completes Atheros takeover

Qualcomm has completed the acquisition of semiconductor maker Atheros Communications for USD 3.1 billion. The Atheros team will operate as Qualcomm Atheros, a wholly owned subsidiary of Qualcomm. In addition, the Qualcomm connectivity team will shift over to Qualcomm Atheros to combine resources and roadmaps. Qualcomm estimates that on a non-GAAP basis the acquisition will be dilutive to earnings per share in this fiscal year and modestly accretive in fiscal 2012. In addition, based on preliminary estimates, the company expects the transaction to be further dilutive to GAAP earnings by approximately USD 0.09-0.13 per share for the remainder of this fiscal year driven primarily by certain near-term purchase accounting charges and secondarily by ongoing share-based compensation expense. These near-term purchase accounting charges result from the requirement in ASC 805 to record acquired inventory and backlog at fair value at the time of acquisition, which will result in reduced margin contribution as inventory and backlog as of the acquisition date are converted to revenues over the remainder of this fiscal year. Former Atheros CEO and president Craig Barratt has been appointed as the president of Qualcomm Atheros and he will report directly to Qualcomm executive vice president and group president Steve Mollenkopf.