Aliso Viejo-based chipmaker Microsemi Corp. is on the verge of surpassing its $1 billion revenue goal following a wave of acquisitions.
Microsemi has acquired at least seven companies since mid-2010, strengthening its position in the timing and synchronization, defense, communications and aerospace markets.
The buys helped the company top $934.2 million in revenue for 12 months through June, up 96% from two years earlier. The percentage increase ranked No. 16 on this week’s list of Fastest-Growing Public Companies (see list, page 40).
Microsemi’s chips serve a variety of military, aerospace, consumer and industrial uses.
Its products are built into satellites, digital televisions, X-ray body scanners and other devices. Customers include Cisco Systems Inc., Boeing Co., Hewlett-Packard Co., Dell Inc. and Samsung Electronics Co.
The company’s $633 million hostile takeover of Canadian competitor Zarlink Semiconductor Inc. last year expanded its reach in the communications and medical markets—two key segments of its growth plan.
Ottawa-based Zarlink saw about $250 million in annual revenue. The deal was Micro-semi’s largest to date, trumping its November 2010 buy of Northern California-based rival Actel Corp. for $430 million.
Microsemi bought key assets from Sunnyvale-based Maxim Integrated Products Inc. earlier this year, effectively building on the Zarlink acquisition. In the Maxim deal, Microsemi acquired lines of chips and evaluation boards that specialize in timing and synchronization, key components in tracking information in wireless networks.
The acquired products help speed up and deliver voice, data and multimedia traffic over wireless and land lines in communications equipment.
“Time and Energy”
“Communications is something we dedicated a lot of time and energy on, and we intend to grow,” said Steve Litchfield, Microsemi’s chief strategy officer.
The company’s largest business line accounted for 31% of its record $259.2 million in sales in the June quarter, its most recent earnings. The quarterly revenue figure was 20% higher than a year earlier.
The segment is set for higher growth as telecoms and equipment makers build more base stations to support the explosion of streaming data, according to Litchfield.
“That business will continue to grow as a percentage of revenues,” he said.
Microsemi also has carved out a strong niche in the aerospace market as the aviation industry replaces hydraulic and mechanical systems with electric ones.
Its July 2011 buy of Sunnyvale-based fabless chipmaker ASIC Advantage Inc. enhanced product offerings in the highly profitable sector. Fabless chipmakers design chips but don’t operate factories, known as wafer fabrication plants. They instead hire contractor manufacturers, typically in Asia, to produce their chips.
ASIC’s products include controllers, sensors, analog-to-digital and digital-to-analog converters, and radiation-tested devices.
Technology gained through the ASIC and Actel acquisitions are playing a pivotal role in NASA’s roaming laboratory on Mars. Micro-semi technology on the Curiosity rover was used for navigational and measurement purposes.
