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Semiconductor Value Chain

Avago to Acquire CyOptics

11 April 2013

Analog chip manufacturer Avago Technologies has agreed to acquire CyOptics Inc., an optical chip maker, for $400 million in cash. Avago, which supplies the communications, industrial and consumer industries, expects CyOptics’ Indium Phosphate (InP) technology will expand its reach into the communications and telecommunications markets; and its single-mode InP laser and receiver capability to strengthen Avago's portfolio for next-generation 40G and 100G enterprise and data services center markets.

Avago's optical transceiver products primarily leverage VCSEL-based technology today. In addition, the acquisition of CyOptics will facilitate Avago's establishment of a complementary optical components business, not only to serve growing segments of the access, metro and long-haul markets, but also for enterprise and data center segments.

CyOptics designs, fabricates and packages a portfolio of optical component products across enterprise, data center, access, metro and long-haul market segments. CyOptics' optical components are integrated into optical transceivers, transponders and line cards. Leveraging its Bell Labs and Lucent heritage, CyOptics has built a broad product portfolio and a customer base that includes the leading module and system OEMs. CyOptics revenue has more than tripled over the past three years. During calendar year 2012, CyOptics net sales were approximately $210 million, up 21 percent from 2011.

"We believe CyOptics' leading InP technology and optical manufacturing capability will strengthen Avago's fiber optics portfolio and accelerate our ability to capture next generation 40G and 100G enterprise and data center sockets," stated Hock Tan, President and CEO of Avago. "With CyOptics, we also see interesting revenue growth opportunities in delivering a broad range of proprietary components to the market."



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