Week In Review: Business stories for the week of 6/21-6/25

Electronic News, June 28, 1999

Intel 64 Fund Funds Flow

Intel Corp., Santa Clara, Calif., announced the first five equity investments made by the Intel 64 Fund in technology companies committed to developing products for the IA-64 product family. In addition, Intel said The Boeing Co. and Enron joined the group of corporate users participating in the Intel 64 Fund. Companies receiving funding include Extricity Software Inc., Monterey Design Systems Inc., SpeechWorks International Inc., TimesTen Performance Software and WebLine Communications. The fund is coordinated by Intel with Compaq, Dell, Hewlett-Packard, Intel, NEC and SGI participating as co-investors.

Sun Sets $3M Debt Offer

Sun Microsystems Inc., Fremont, Calif., filed with the Securities and Exchange Commission for the flexibility to raise up to $3 million from offerings of senior or subordinated debt securities, common stock or a combination. This filing is in addition to $1 million in securities registered in October 1997 by the $11 billion Palo Alto company.

LSI Logic, Seeq Deal Done

LSI Logic Inc., Milpitas, Calif., completed its acquisition of Seeq Technology. Under terms of the offer, Seeq shareholders will get LSI Logic stock based on an exchange ratio of .0759. It is a pooling of interests transaction and should be accretive to LSI Logic earnings per share in the second half. The deal is valued at about $106 million.

Arrow Military Deal

The Arrow/Zeus Electronics business group, part of distributor Arrow Electronics Inc., Melville, N.Y., signed an exclusive agreement with Qualified Parts Laboratory to provide a unique Diminished Manufacturing Sources (DMS) solution for military and aerospace customers. Terms of the deal include a provision that Arrow/Zeus will help finance the purchase and build-out of original manufacturer discontinued parts. Arrow/Zeus will be Qualified Parts Laboratory's exclusive distribution channel.

Tender Moment

Royal Philips Electronics of the Netherlands completed its tender offer for the outstanding common stock of Voice Control Systems Inc., Dallas. The acquisition will be completed via a "short form" merger under Delaware law. The remaining VCS shares will be converted into the right to receive $4 per share in cash. Closure is expected at the end of June.

NewBridge to Acquire Stanford

Newbridge Networks, Kanata, Ontario, signed a definitive agreement to acquire Stanford Telecommunications Inc. (STel), a supplier of broadband wireless technology and products. The boards of both companies approved the plan, which is subject to clearance by STel stockholders and other conditions. Newbridge will acquire all of the outstanding shares of common stock of STel in a tax-free, stock for stock exchange. The deal is expected to have a net cost to Newbridge of about $280 million.

Broadcom, Stanford Settle

Broadcom Corp. has settled all outstanding litigation with Stanford Telecommunications Inc. (STel). STel had brought an action against Broadcom in the United States District Court for the Northern District of California alleging that certain Broadcom products infringe a digital modulator patent held by STel. Broadcom counterclaimed and brought a separate action against STel in California Superior Court for misappropriation of Broadcom trade secrets. As part of the settlement, the parties agreed to dismiss all claims and counterclaims.

Back to Fabless

IBM and Cirrus Logic Inc. are restructuring their MiCRUS wafer fab joint venture in East Fishkill, N.Y. With the closing of the agreement, Cirrus Logic's capacity obligations in MiCRUS will be re-sized immediately to meet current business needs, and IBM will assume full control of the venture. Cirrus Logic's reduced capacity obligations will continue through Dec. 31, 2000. "By eliminating the fixed manufacturing costs associated with our MiCRUS joint venture, we have successfully achieved a major milestone in building our new business model to operate more efficiently," said David French, chief executive officer, Cirrus Logic. The company will record a restructuring charge in the current fiscal quarter.

Mylex, Lobster Share

Mylex Corp., Fremont, Calif., has formed a joint venture with Lobster Computer Concept GmbH of Germany. The Berlin-based venture will be called LXCO Technologies AG, and will be focused on the development and marketing of network attached storage products. In exchange for the transfer of Mylex intellectual property and technology, Mylex will receive a 19 percent interest and the option to increase that interest to 45 percent at no extra cost after October 1. The first product of this venture is set for the latter part of 1999.

A Magic Stake

General Magic, Sunnyvale, Calif., said Excite@Home has made a $6 million investment in General Magic. The investment is in the form of non-voting, non-redeemable shares of Series E Preferred Stock, plus a warrant to purchase up to $1 million worth of additional Series E Stock. The companies also announced a technology relationship to use General Magic's magicTalk voice user interface in Excite@Home's new Excite Voicemail service.