Date: 13/07/2009

Broadcom gave up the pursuit for Emulex

After Emulex rejecting the acquisition offer made by Broadcom, Broadcom decided to cancel its effort in acquiring Emulex.

Emulex makes high-speed data communication products, which does complement the product bag of Broadcom. Emulex makes boards and chips covering fibre channel devices for the data center market. Broadcom has attempted to buy Emulex by all-cash $11-per-share offer announced on June 29, 2009. But Emulex Board of Directors rejected this offer.

In this failed business merge attempt, both are losers. Broadcom lost an opportunity to expand and strengthen its product range better than its close competitors in wired communication business. Emulex with its limited product range and large-size competitors around, in future it might have to face tough time in maintaining it's unique product offerings (if any) for long time.

This failed acquisition bid joins other two acquisition failures happened with in last 12 months in the semiconductor industry. The other two failed attempts were, Microchip and ON Semiconductor bid for Atmel, and Gennum missing Tundra Semiconductor. But IDT grabbed Tundra Semiconductor by bidding more. Does this happen to Emulex? There are little chances if we look at the wired communication semiconductor market.

Wired communications market is dull compared to wireless market, recently Infineon has sold its wired communication to a US based investor Golden Gate Capital for Euro 250 million.