In what could be the biggest local chip deal in years, Irvine’s Teridian Semiconductor Corp. said it’s set to be acquired by Sunnyvale’s Maxim Integrated Products Inc. for $315 million in cash.
In the past few years, Teridian has reworked its business and pegged its growth on making chips for a new type of electricity meter that operates as part of a smart grid designed to reduce energy consumption.
Maxim picked up Teridian to get into the market for what’s called “smart meter” chips.
“It is a major supplier to 3 of the top 4 major meter manufacturers in the U.S. and to over 50 meter manufacturers globally,” Maxim Integrated said in a statement.
Teridian has about 100 workers in Irvine and sees an estimated $75 million in yearly sales.
It’s unclear whether Maxim, which sees yearly sales of $1.7 billion, will keep the local operations.
Some 60% of Teridian’s revenue comes from meter chips. The rest comes from “legacy” products, which include chips that go into set-top boxes, circuit breakers and networking gear.
Teridian sees a big market for smart meter chips, which use networking technology to track electricity usage and send data to utility companies and residents.
Its chips help utility companies get more accurate meter readings, cut down on billing errors and prevent tampering.
The company counts some 70 customers, which build meters and sell them to utilities.
They include General Electric Co., South Carolina’s Actaris Liquid Measurement LLC, Germany’s Elster Group SE and Australia’s Landis & Gyr Holdings Pty.
Teridian has made a slow ascent through the ranks of the area’s chipmakers.
It now is one of the largest 10 semiconductor companies here by workers—a list that includes Irvine’s Broadcom Corp., Newport Beach’s Conexant Systems Inc. and Irvine’s Microsemi Corp., among others.
Teridian started as TDK Semiconductor Corp., part of Japan’s TDK Corp.
After the tech bubble burst, TDK Semiconductor sought a public spinoff from its Japanese parent. The plan faded after sales dropped by half from 2001 to 2002 and it sunk into red ink.
By 2005, TDK sold the business to San Francisco-based investment firm Golden Gate Capital.
— Sarah Tolkoff
