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EXHIBIT 99.1
NEWS RELEASE
BROADCOM BUSINESS MEDIA CONTACTS BROADCOM FINANCIAL ANALYST CONTACT
Bill Blanning William Ruehle
949-585-5555 Vice President and
[email protected] Chief Financial Officer
or Eileen Algaze 949-450-8700
949-585-5971 [email protected]
[email protected]
ALTIMA COMMUNICATIONS CONTACT
Steve Kubes
Vice President, Sales and Marketing
408-453-3700
[email protected]
BROADCOM CORPORATION TO ACQUIRE ALTIMA COMMUNICATIONS, INC.
Acquisition Expands Broadcom's Networking Portfolio for Small-to-Medium Size
Business Applications and Strengthens Presence in Asia
IRVINE, Calif. - July 31, 2000 - Broadcom Corporation (Nasdaq: BRCM), the
leading provider of integrated circuits enabling high speed broadband
communications to and throughout the home and business, today announced that it
has signed a definitive agreement to acquire Altima Communications, Inc., a
leading supplier of networking integrated circuits (ICs) for the small-to-medium
business (SMB) networking market.
The acquisition of Altima will substantially accelerate Broadcom's penetration
of the fast growing SMB equipment market. According to The Dell'Oro Group, the
SMB market for 10/100 switches and hubs is forecasted to grow by well over 100%
this year, and to reach 58 million ports by 2001.
Altima's networking IC product portfolio was designed and optimized for the
cost-sensitive, value-oriented SMB customer, with emphasis on low-power, small
footprint, and low system cost. Altima's product and market orientation
complements Broadcom's market leadership position in providing high-performance,
full-featured, system-level IC solutions for the enterprise network market.
Broadcom plans to retain the Altima(TM) brand name for the SMB product line,
taking immediate advantage of Altima's established identity and its market
leadership in the SMB space.
Altima's existing customer base is predominantly in Asia, where the majority of
SMB manufacturers reside. To best address the unique product and support
requirements of its Asian customers, Altima has built a strong team of engineers
and customer support personnel in
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Broadcom Corporation to Acquire Altima Communications, Inc.
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Taiwan, part of a larger engineering team that brings to Broadcom significant
additional experience and expertise in mixed signal IC design and Ethernet
networking.
"Altima's well-established infrastructure in Asia will strengthen Broadcom's
presence and enable us to better serve our customers engaged in the high-growth
SMB market segment," said Dr. Henry T. Nicholas III, President and CEO of
Broadcom. "Like Broadcom, Altima has established a track record for rapidly
designing and ramping to volume production products that meet the requirements
of its target market. As a result of Altima's complementary market focus and
engineering execution, we will inherit a non-overlapping revenue stream."
"We're excited to combine forces with Broadcom to better address the enormous
opportunities in the SMB market," said Dr. Stewart Wu, President and CEO of
Altima. "Our team will benefit from Broadcom's excellent sales and marketing
team, core technologies and manufacturing expertise to help accelerate
introductions of next-generation solutions for the SMB market."
Sam Liang, Executive Vice President of D-Link Corporation, said, "D-Link is
pleased to see Broadcom's investment in small to medium sized business solutions
from Altima. The combined Broadcom/Altima team will accelerate next-generation
solutions to support our growth objectives."
Yimin Doo, President of Accton Technologies, said, "Altima's cost-effective,
low-power solutions have been widely deployed across Accton's product lines,
which support our small to medium-sized business solutions. Altima's local
Taiwan support with research and development and technical support have been a
valuable asset."
"Netgear and Broadcom have a strong relationship and the acquisition of Altima
is a welcome addition to that relationship," said Patrick Lo, CEO of Netgear.
"Altima's product line complements Broadcom's existing line, which allows us to
capitalize upon an even larger product portfolio."
In connection with the acquisition, Broadcom will issue in aggregate about 2.5
million shares of its Class A Common Stock (valued at about $533 million based
upon the closing price on the Nasdaq National Market(R) on July 28, 2000) in
exchange for all outstanding shares of Altima Preferred and Common Stock and
upon exercise of outstanding employee stock options of Altima. The merger
transaction is expected to close within 60 days and will be accounted for under
the purchase method of accounting. The boards of directors of both companies
have approved the merger, which awaits approval by Altima's shareholders and the
satisfaction of regulatory requirements and other customary closing conditions.
Broadcom expects to record a one-time write-off for purchased in-process
research and development expenses related to the acquisition in its third fiscal
quarter (ending September 30). In addition to the purchase consideration,
Broadcom will reserve up to 2.9 million shares of its Class A Common Stock for
future issuance upon exercise of outstanding Altima performance-based warrants
that become exercisable upon satisfaction of certain customer purchase
requirements.
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Broadcom Corporation to Acquire Altima Communications, Inc.
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ABOUT ALTIMA COMMUNICATIONS
Altima Communications, Inc. designs, manufactures and markets low-power,
high-performance communications IC solutions for high-speed networking and
Internet infrastructure applications. With its ultra physical layer technology
using an advanced mixed-signal core architecture, Altima offers a broad range of
networking products for switches, dual speed repeaters, routers, Internet
gateways and Internet appliances. Altima is headquartered in San Jose, Calif.
For more information, visit www.altimacom.com.
ABOUT BROADCOM
Broadcom Corporation is the leading provider of highly integrated silicon
solutions that enable broadband digital transmission of voice, video and data to
and throughout the home and within the business enterprise. Using proprietary
technologies and advanced design methodologies, the company designs, develops
and supplies integrated circuits for a number of the most significant broadband
communications markets, including the markets for cable set-top boxes, cable
modems, high-speed office networks, home networking, Voice over Internet
Protocol (VoIP), residential broadband gateways, direct broadcast satellite and
terrestrial digital broadcast, optical networking, digital subscriber lines
(xDSL) and wireless communications. Broadcom is headquartered in Irvine, Calif.,
and may be contacted at 949-450-8700 or at www.broadcom.com.
SAFE HARBOR STATEMENT OF BROADCOM CORPORATION UNDER THE PRIVATE SECURITIES
LITIGATION REFORM ACT OF 1995:
This release may contain forward-looking statements based on our current
expectations, estimates and projections about our industry, management's
beliefs, and certain assumptions made by us. Words such as "anticipates,"
"expects," "intends," "plans," "believes," "seeks," "estimates," "may," "will"
and variations of these words or similar expressions are intended to identify
forward-looking statements. In addition, any statements that refer to
expectations, projections or other characterizations of future events or
circumstances, including any underlying assumptions, are forward-looking
statements. These statements are not guarantees of future performance and are
subject to certain risks, uncertainties and assumptions that are difficult to
predict. Therefore, our actual results could differ materially and adversely
from those expressed in any forward-looking statements as a result of various
factors.
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Broadcom Corporation to Acquire Altima Communications, Inc.
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Important factors that may cause such a difference for Broadcom in connection
with the acquisition of Altima Communications include, but are not limited to,
the risks inherent in acquisitions of technologies and businesses, including the
timing and successful completion of technology and product development through
volume production, integration issues, costs and unanticipated expenditures,
changing relationships with customers, suppliers and strategic partners,
potential contractual, intellectual property or employment issues, accounting
treatment and charges, and the risks that the acquisition cannot be completed
successfully or that anticipated benefits are not realized; the rate at which
present and future customers and end-users adopt Broadcom's and Altima's
technologies and products in the markets for Ethernet networking products;
delays in the adoption and acceptance of industry standards in the foregoing
markets; the timing of customer-industry qualification and certification of our
products and the risks of non-qualification or non-certification; the timing,
rescheduling or cancellation of significant customer orders; the loss of a key
customer; the volume of our product sales and pricing concessions on volume
sales; silicon wafer pricing and the availability of foundry and assembly
capacity and raw materials; the qualification, availability and pricing of
competing products and technologies and the resulting effects on sales and
pricing of our products; intellectual property disputes and customer
indemnification claims; fluctuations in the manufacturing yields of our third
party semiconductor foundries and other problems or delays in the fabrication,
assembly, testing or delivery of our products; our ability to specify, develop
or acquire, complete, introduce, market and transition to volume production new
products and technologies in a timely manner; the effects of new and emerging
technologies; the effectiveness of our product cost reduction efforts; the risks
of producing products with new suppliers and at new fabrication and assembly
facilities; problems or delays that we may face in shifting our products to
smaller geometry process technologies and in achieving higher levels of design
integration; the risks and uncertainties associated with our international
operations; our ability to retain and hire key executives, technical personnel
and other employees in the numbers, with the capabilities, and at the
compensation levels needed to implement our business and product plans; changes
in our product or customer mix; the quality of our products and any remediation
costs; the effects of natural disasters and other events beyond our control; the
level of orders received that can be shipped in a fiscal quarter; potential
business disruptions, claims, expenses and other difficulties resulting from
residual "Year 2000" problems in computer-based systems used by us, our
suppliers or our customers; general economic conditions and specific conditions
in the markets we address; and other factors.
Our Annual Report on Form 10-K, recent and forthcoming Quarterly Reports on Form
10-Q, recent Current Reports on Forms 8-K and 8-K/A, and other Securities and
Exchange Commission filings discuss some of the important risk factors that may
affect our business, results of operations and financial condition. We undertake
no obligation to revise or update publicly any forward-looking statements for
any reason.
Broadcom(R) and the pulse logo are trademarks of Broadcom Corporation and/or its
subsidiaries in the United States and certain other countries. Altima is a
trademark of Altima Communications, Inc. in the United States and certain other
countries.
