Broadcom to buy GPS technology provider for $146M

By Colleen Taylor, Contributing Editor -- Electronic News, 6/12/2007

Communications chipmaker Broadcom Corp. today announced that it has signed a definitive agreement to acquire Global Locate Inc., a privately held, fabless provider of global positioning system (GPS) and assisted GPS (A-GPS) semiconductor products and software, for $146 million.

Global Locate's semiconductor solutions are used in mobile phones from cellular handset makers and incorporated into products from TomTom NV, the largest personal navigation device (PND) vendor in the world.

Broadcom said it plans to incorporate Global Locate's GPS technology with its Bluetooth, Wi-Fi, cellular and other mobile technologies in an effort to add value to feature and smart phone products. Global Locate has focused on GPS chip and navigation technology since it was founded in 1999. The company is currently producing its third generation of GPS chips and has developed a worldwide GPS reference network that provides assistance data to its A-GPS-equipped chips via cellular data channels, purportedly reducing the time required to determine a location by up to 100 times.

"With the acquisition of Global Locate, Broadcom will be the only semiconductor supplier in the world with top-tier customers in Bluetooth, Wi-Fi, FM radio and GPS, four of the key wireless technologies now being added to next generation mobile phones," Robert A. Rango, senior VP and general manager of Broadcom's wireless connectivity group, said in a statement. "We are also pleased to add Global Locate's strong patent portfolio of over 175 issued and pending U.S. and foreign patents to our already robust patent portfolio."

In connection with the acquisition, Broadcom said it expects to pay approximately $146 million net in cash at closing in exchange for all outstanding shares of capital stock and other rights of Global Locate. Additional consideration of up to $80 million in cash will be reserved for future payment to the former holders of Global Locate capital stock and other rights upon satisfaction of certain performance goals. The boards of directors of both companies have approved the merger. The closing, which is expected to occur during Broadcom's Q3 ending September 30, remains subject to customary closing conditions.

The Global Locate buy is not the only way that Broadcom has planned growth recently. Last month, the Irvine, Calif.-based company announced plans to expand its cellular design center in the Xin-Yi district of Taiwan and add around 20 Broadcom engineers there focused on Microsoft technology. Financial terms of that expansion have not been disclosed.