Conexant completes sale of Broadband Media Processing unit

August 11, 2008 - US semiconductor firm Conexant has completed the sale of its Broadband Media Processing unit to NXP Semiconductors, and will receive approximately US$110mn in cash and up to US$35mn in an "earn-out" fee, contingent upon the achievement of certain milestones through 2009.

Conexant's Broadband Media processing unit provides products for satellite, cable, terrestrial and IPTV set-top box applications, and approximately 700 Conexant employees joined NXP Semiconductors upon completion of the transaction. Conexant reportedly plans to use the majority of the net proceeds to retire some of its debt.

“The divestiture of our Broadband Media Processing business is consistent with our overall strategy of improving our business model and generating positive cash flow, focusing our investments on the market segments where we either lead or have the opportunity to lead, and establishing a long-term, sustainable capital structure,” said Scott Mercer, CEO of Conexant.

“Our continuing businesses, which consist of Imaging and PC Media and Broadband Access, address a total available market that is more than $3 billion today and expected to grow at a compound annual rate of seven percent over the next several years, and we plan to expand our presence in each of the major market segments we serve," he added.