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Date: 26-10-14

Qualcomm to acquire CSR to speed-up its IOT growth

Qualcomm has reached agreement with CSR, where the share capital of CSR will be acquired at a rate of £9.00 per share, which is valued approximately US dollar 2.5 Billion.

UK-based fabless Wireless semiconductor chip maker CSR is one of the fast-grown companies in the area of Bluetooth, but from past one year or little more, CSR is not seeing the same level of growth, what it has seen before. CSR may find the acquisition proposal by Qualcomm a somewhat welcome.

To increase its revenue growth, CSR focused on IOT or IOE market with its Bluetooth smart and other wireless products. CSR has build good number of intellectual property in the area of Bluetooth and Bluetooth smart, it has fairly good customer base in the consumer and automotive domain. Qualcomm, the company which can be ranked as a global number one wireless chip vendor in the area of mobile communication, and short-range Wi-Fi and Bluetooth, is aggressively focusing on the IOT market with some successful product launches. CSR is excellent match to fill the gaps in its Bluetooth offerings.

Earlier to Qualcomm, microcontroller specialist Microchip proposed to acquire CSR, but the deal did not materialise. It looks like CSR is lucky to get a better bidder such as Qualcomm.

On the revenue growth plan of CSR in 2014, its CEO Joep van Beurden made below comments to this writer in a video interview published in the month of February 2014:
"There are two parts of our business one is a core business and other is legacy. the legacy business is the business we do not invest and that is typically low margin business and mostly selling Bluetooth chips into phones. Our legacy businesses shrinking and our core businesses rising. Our core business is high margin and in the automotive infotainment, Bluetooth smart, voice and music, and streaming audio, all this is doing well quite a lot. Internet of things is quite small but have a very high expectation there. "

The full video interview:

 

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