Broadcom Corporation has announced that it has signed a definitive agreement to acquire ServerWorks Corporation, an independent supplier of high-performance system input/output integrated circuits for servers, for approximately US $957 million.
‘ServerWorks’ impressive customer base, coupled with its aggressive technology roadmap and proven track record, will enable Broadcom to enhance the entire Internet and Intranet infrastructure,’ said Dr Henry T Nicholas III, President and CEO of Broadcom. ‘Broadcom’s networking technology in combination with ServerWorks’ SystemI/O solutions will alleviate the congestion occurring both to and within the servers and storage devices through which all forms of Internet traffic pass.’
ServerWorks’ System I/O silicon solutions are said to act as essential conduits for delivering high-bandwidth data in and out of servers, and co-ordinating all I/O transactions within the server platform including between external I/O, the main system memory and the CPUs.
The addition of ServerWorks’ product portfolio and system expertise will, according to a statement from Broadcom, enable Broadcom to deploy wire-speed 10 Gigabit per second (Gbps) communications topologies such as InfiniBand, Ethernet and Fibre Channel into server and storage platforms, and expand the company’s participation in these markets. 10Gbps is anticipated to be the speed at which local area, wide area and storage area networks converge.
In connection with the acquisition, Broadcom will issue approximately 11 million shares of its Class A common stock in exchange for all outstanding shares of ServerWorks common stock and upon exercise of outstanding employee stock options, warrants and other rights of ServerWorks.
The merger transaction is expected to close within 60 days. The Boards of Directors of both companies, who approved the merger, await approval by ServerWorks’ stockholders and the satisfaction of regulatory requirements and other customary closing conditions.