Following its strategic goal to assume the lead in the fast growing LAN, WAN and broadband access markets, Infineon Technologies (NYSE: IFX ) today announced the acquisition of the Israeli based broadband communications IC (integrated circuit) specialist Savan Communications.
Savan's leading VDSL technology, that enables broadband data transmission for the last mile of network access and within local networks, ideally complements the portfolio of Infineon's Communications and Peripherals Division. Infineon already had a 18.2 per cent stake in Savan and will now acquire the remaining shares in the company, including all intellectual property as well as other assets and operations for a cost of approximately US$ 120 million.
The ongoing partnership between Infineon, a worldwide leader for xDSL solutions, and Savan, the VDSL (Very high bitrate Digital Subscriber Line) front-runner has already been instrumental in defining the VDSL ETSI (European Telecommunication Standards Institute) standard. Infineon is intent on repeating its unprecedented success in the ISDN arena and expects to become the leading provider of highly integrated xDSL solutions through the acquisition of Savan. All employees of Savan will be transferred to the newly formed company.
Infineon will focus on providing broadband solutions for delivering bundled services such as voice, data, and video based on Savan's proven VDSL technology and Infineon's unique capabilities in fiber optics, providing access solutions spanning from routers, LAN switching, VDSL, cable modems and home networking. As fiber deployment gets closer to the subscriber, the number of homes in the range of entertainment quality video services is expected to increase from six million today to over 70 million by 2005 (US Federal Communications Commission and Cahners In-Stat Group).
``By acquiring Savan, Infineon will strongly support the aim of achieving sustainable leadership in the broadband communications market. We will use Savan's experience and the vast know-how of their world class employees in new and emerging markets and in VDSL technology - for high data rate transmission - to give us a nucleus for future xDSL development activities,'' said Gerhard Geiger, Senior Vice President and General Manager of Infineon's Communication and Peripherals Division.
``Savan has always enjoyed a successful and productive partnership with Infineon. This acquisition allows us to pool our resources and maintain our global market leadership in the VDSL arena and forthcoming technologies,'' said Noam Alroy, former CEO of Savan, who has been named CEO of Infineon Technologies Savan.
Published by Israel's Business Arena on April 27, 2000.