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Strategies & Market Trends : VOLTAIRE'S PORCH-MODERATED -- Ignore unavailable to you. Want to Upgrade?

To: Dealer who wrote (20418)	11/29/2000 8:30:39 AM
From: Dealer	Respond to of 65232

BRCD--Broadcom to Buy VisionTech For About $677 Million in Stock By Molly Williams Staff Reporter of The Wall Street Journal IRVINE, Calif. -- Broadcom Corp. agreed to buy closely held VisionTech Ltd., an Israeli maker of chips that allow customers to personalize television and video recording and playback, for about $677 million in stock. The acquisition is the 12th this year for Broadcom, which makes chips that enable faster transmission of information on cable networks through modems or set-top boxes. It plans to issue 7.96 million Class A shares for all the assets and shares outstanding and options of VisionTech. Broadcom's shares fell 13%, or $12.50, to $85.06, marking a 52-week low, in Nasdaq Stock Market trading at 4 p.m. VisionTech's products, which are used by companies including Motorola Inc., Microsoft Corp.'s WebTV and Scientific-Atlanta Inc., are chips that decode video, voice and data content for consumer electronics devices. The products are found in personal TVs, personal video recorders and cable set-top boxes and allow a user to freeze, fast-forward or rewind live television or video. By next year, the products will be in personal computers, camcorders and other products. "This accelerates our lead in next-generation set-top boxes," said Henry Nicholas, chief executive officer of Broadcom. The market for personal video recording set-top boxes is expected to more than triple for each year from 2001 through 2003. Broadcom said the acquisition will shave about a penny off its earnings in the first two quarters of next year but is expected to start adding to earnings by the end of the second quarter. Broadcom said it expects the integration of VisionTech's technology into its family of products to allow customers to produce set-top boxes with more functionality at better prices. The companies, which have been working together for about a year, will show off a set-top box with personal video recording capabilities at the Western Cable Show in Los Angeles this week. VisionTech, based in Herzliya, Israel, will become the core of Broadcom Israel, which will be managed by VisionTech Chief Executive Amir Morad, the companies said. The acquisition is expected to close in about 60 days, and Broadcom expects to take an unspecified charge for purchased research and development. Earlier this month, Broadcom agreed to pay $2 billion for SiByte Inc., a closely held firm with one product, no revenue yet and about 120 employees.