MACOM buys AppliedMicro, but will sell compute business

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MACOM has signed a definitive agreement under which it will acquire Applied Micro for $770million. According to the company, AppliedMicro’s connectivity business is complementary to its product portfolio, adding OTN framers, MACsec Ethernet networking components and what it claims to be the leading single lambda PAM4 platform.

John Croteau, MACOM’s president and CEO, said: “MACOM will now be able to provide all the requisite semiconductor content for optical networks – analogue, photonic and PHY – from the switch to fibre for long haul, metro, access, backhaul and data centre.

“Notably, the IEEE recently recommended the adoption of AppliedMicro’s single lambda PAM4 solution as an industry standard for enterprise and data centre connectivity, positioning this technology as the solution of choice going forward.”

However, MACOM has said that it will dispose of AppliedMicro’s computing business within 100 days of the transaction closing, noting this element does not align strategically with its long-term and adding there are ‘several potential buyers and investors’.

AppliedMicro signed an architectural licence from ARM, enabling it to develop its own 64bit CPU compliant with ARM's v8 architecture. One of the results of this has been the X-Gene processor. Earlier this year, the European UniServer project launched, saying that it would use X-Gene technology to develop a universal system architecture and software ecosystem for servers.

Paramesh Gopi, AppliedMicro’s president and CEO, noted: “This agreement provides a promising path forward for the compute business, which is in the process of bringing AppliedMicro’s third-generation X-Gene processor to market.”