ASIC specialist eSilicon expands strategy, seeks acquisitions

Mark LaPedus, EE Times
(05/06/2008 2:32 PM EDT)

SUNNYVALE, Calif. — After hitting a few speed bumps along the road, fabless ASIC vendor eSilicon Corp. appears to have regained its momentum and has expanded its strategy.

eSilicon (Sunnyvale, Calif.) continues to push the leading-edge in ASIC designs and is building up a portfolio of intellectual-property cores. It has also taken its first steps on the acquisition trail by recently buying Sweden's SwitchCore AB, a provider of Ethernet switching chips.

At the time of the acquisition late last year, SwitchCore was at or near bankruptcy. The company's latest product was late to the market, and Switchcore was simultaneously was embroiled in a lawsuit with EDA vendor Synopsys Inc.

Instead of liquidation, SwitchCore decided to settle its suit with Synopsys and subsequently sold its assets to eSilicon for about $3 million in cash. The deal could boost eSilicon's bottom line; SwitchCore's products could generate sales from about $800,000 to $1.7 million a year, according to the company.

Despite the acquisition, eSilicon has no plans to migrate away from its fabless ASIC business model. It will not become a supplier of standard chip products, said Jack Harding, president, chief executive and chairman of eSilicon, in a recent interview at the company's headquarters here.

ESilicon has no plans to develop new versions of SwitchCore's products. The fabless ASIC house will continue to support SwitchCore's existing products and customers for a ten-year period, Harding said.

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