Mellanox Technologies Ltd of Sunnyvale, CA, USA and Yokneam, Israel, a supplier of end-to-end InfiniBand and Ethernet interconnect solutions for servers and storage systems, has agreed to acquire privately held Kotura Inc of Monterey Park, CA, USA, which designs silicon photonics application-specific integrated circuits (ASICs) for the communications, computing, sensing and detection markets, for about? $82m (subject to certain adjustments). The transaction has been approved by both the Mellanox and Kotura boards of directors.
The transaction is projected to close in second-half 2013. Mellanox expects the transaction to be accretive to its full-year fiscal 2014 earnings by $0.01-0.03 per share (on a non-GAAP basis). Mellanox expects the acquisition to expand its ability to deliver high-speed networks with next-generation optical connectivity, allowing data-center customers to meet the growing demands of high-performance Web 2.0, cloud, data-center, database, financial services and storage applications. Mellanox believes that the acquisition will enhance its ability to provide leading technologies for high-speed, scalable and efficient end-to-end interconnect solutions.
Silicon photonics is expected to play a significant role in the enablement of high-speed networks. With more than 120 granted or pending patents in CMOS photonics and packaging design, Kotura has integrated multiple high-speed active and passive optical functions onto a silicon chip. Mellanox reckons that the technology will enable its interconnect products to reach bandwidths of 100Gb/s and beyond, and have longer-reach optical connectivity at a lower cost, allowing users to further reduce their capital and operating expenses and offer new revenue-generating services.
Mellanox expects the proposed acquisition of Kotura to enhance its competiveness and its position as a provider of high-performance, end-to-end interconnect solutions for servers and storage systems.
Mellanox expects to establish its first R&D center in the USA at Kotura's current location. It also intends to retain Kotura's existing product lines to ensure continuity for customers and partners.
"Operating networks at 100 Gigabit per second rates and higher requires careful integration between all parts of the network," says Mellanox's president, CEO & chairman Eyal Waldman. "We believe that silicon photonics is an important component in the development of 100 Gigabit InfiniBand and Ethernet solutions, and that owning and controlling the technology will allow us to develop the best, most reliable solution for our customers. We expect that the proposed acquisition of Kotura's technology and the additional development team will better position us to produce 100Gb/s and faster interconnect solutions with higher-density optical connectivity at a lower cost," he adds.
"This acquisition is important for both companies to enable interconnect innovation for data centers that require solutions that move data faster and more efficiently," says Kotura's president & CEO Jean- Louis Malinge. "Together, we can execute faster and deliver better solutions based on Kotura's silicon photonics platform that delivers the demands of 100Gb/s interconnects and beyond," he believes.
The proposed acquisition is subject to customary closing conditions, including the receipt of applicable regulatory approvals and the approval of Kotura's shareholders.
