Silicon Labs hopes to drive IoT revenue growth and develop its Wi-Fi 6 technology with the acquisition of wireless and MCU assets from Redpine Signals.
Silicon Labs said it will acquire Redpine Signals’ Wi-Fi and Bluetooth assets, its development center of around 200 people in India and its extensive patent portfolio for $308 million in cash.
With the acquisition, Silicon Labs hopes to do two things. The first is to bring Redpine’s existing products into the sales channel and drive IoT revenue growth. The company expects $20 million in incremental revenue on an annualized basis for FY2020, and targeting $100 million revenue by 2023 for all its wireless products for the IoT. The other is to rely on the India-based team to accelerate its product development for Wi-Fi 6.
The acquisition includes Bluetooth classic IP (including extended data rate) for audio applications including wearables, hearables, voice assistants and smart speakers. Silicon Labs told EE Times that as part of the deal, the company also acquired Redpine’s microcontroller (MCU) business, along with real-time location services technology.
Tyson Tuttle, CEO of Silicon Labs, said, “The acquisition of Redpine Signals’ ultra-low-power Wi-Fi and Bluetooth products and extensive intellectual property portfolio will expand our leadership in IoT wireless technology. The addition of these products into our worldwide sales and distribution network will drive further momentum in the smart home, industrial IoT and commercial markets for customers who want to get to market quickly with Wi-Fi enabled connected devices.”
Speaking at today’s analyst day (delivered as a webcast), he said that while Wi-Fi 6 was something the company was looking at developing through the acquisition, the key products that will drive revenue growth right now are Wi-Fi 4 and Bluetooth and associated software.
He commented, “The revenue growth is not predicated on Wi-Fi 6. It’ll be years before Wi-Fi 6 becomes part of the equation. What we will be doing is taking existing products and driving them through our sales channels.”
Wi-Fi 6 (802.11ax) is an important evolution of the Wi-Fi standard to meet low power, performance, security and interoperability requirements needed in environments with hundreds or thousands of connected IoT devices. The integration of the Redpine Signals technology will accelerate Silicon Labs’ roadmap for Wi-Fi 6 silicon, software and solutions.
Tuttle said, “There’s a lot of talent in Hyderabad which is very relevant to the technologies we are trying to develop.” The Redpine Signals acquisition includes an at-scale design center with approximately 200 employees in Hyderabad, India. This additional multidisciplinary team is expected to help Silicon Labs scale its R&D faster and more efficiently in one of the most talent-rich locations in India.
With almost all of the Redpine Signals business acquired, we wondered what is left of the business to continue trading. So, we asked. This is the response we received from Venkat Mattela, founder and CEO of Redpine Signals: “Following the close of the acquisition, the remaining Redpine team will continue building ultra-low-energy artificial intelligence (AI) and machine learning (ML) processors. The Wi-Fi, Bluetooth, MCU and real-time location services businesses will transfer to Silicon Labs.”
He added, “My team is excited to join Silicon Labs. Backed by two decades of advanced research in OFDM and MIMO systems, Redpine has created highly differentiated, low-power multiprotocol SoCs. Going forward, low-power Wi-Fi 6 is a key wireless technology for connectivity in IoT devices.”
Redpine Signals was founded in 2001 with headquarters in San Jose, Calif., though most of its development team was in India. The company developed a number of ultra-low power and high-performance wireless and microcontroller (MCU) products. It claims it was the first in the industry to launch an ultra-low power single-stream 802.11n chipset in late 2007, and also pioneered the adoption of self-contained 802.11abgn modules into the then emerging IoT market in 2009; and in 2013, it introduced a multiprotocol wireless chipset featuring dual band Wi-Fi, dual-mode BT 4.1, and ZigBee. Redpine’s third-generation chipset, integrates eight wireless protocols on a single die in 40nm. With an extensive patent portfolio on OFDM, MIMO, embedded processor architectures and low-power techniques, Redpine’s technology and product portfolio includes chipsets, modules and devices.
The boards of directors of both companies and the stockholders of Redpine Signals have approved the transaction, which is expected to close in the second quarter of 2020 subject to customary closing conditions.