Cypress Semiconductor has purchased SMaL Camera Technologies, the Cambridge, MA-based image sensor and system developer.
Under the terms of the deal, Cypress will pay $42.5 million in cash, plus a performance-based earnout plan, contingent primarily on SMaL achieving certain revenue levels. SMaL posted sales of $10.5 million in fiscal year 2004.
The SMaL acquisition will accelerate Cypress’s entry into the high-volume CMOS image sensor business, initially targeting the market for three- and five megapixel cell phone cameras and automotive imaging systems.
SMaL’s product line will complement new cell phone products that Cypress will introduce in the second half of 2005 through its acquisition of FillFactory last year. Like FillFactory, SMaL will be integrated into Cypress’s Memory Products Division (MPD).
“FillFactory brought high-end products and a focus on custom solutions to Cypress,” said Luc De Mey, founder, president and CEO of the Belgium-based, IMEC-spinoff prior to its acquisition by Cypress last year. “SMaL provides a different capability altogether – consumer-oriented imaging solutions available now for mass markets. Together, the two businesses comprise a complete portfolio of products with high margins, on the one hand, and the potential for extremely high volume, on the other.”
The demand for CMOS image sensors – essentially cameras on a chip made with standard CMOS process technology – is growing rapidly, driven by a swift expansion of the market for digital still cameras (DSCs) and cell phone cameras.
According to a Q204 report by the El Segundo, CA-based semiconductor research firm iSuppli, the 78-million-unit market for CMOS sensors in 2003 is projected to expand at an annual rate of more than 40 percent through 2008.