CSR outlays up to $110m on acquisitions to take it into GPS
CSR plc (CSR.L) has acquired NordNav Technologies AB and the assets of Cambridge Positioning Systems Ltd for a total of up to $110m.
The Bluetooth specialists said the acquisitions, when combined, will allow CSR to provide software-based high performance GPS (Global Positioning System) suitable for mass-market mobile handsets, PNDs (Personal Navigation Devices), PCs and other portable devices for an incremental price that falls to less than $1 of the overall bill of materials when used with CSR's Bluetooth.
CSR said the acquisitions will enable allow it to offer the most competitive, complete and technically advanced mobile GPS solution available at a very low additional cost.
CEO John Scarisbrick (pictured) said: "We will be able to provide a technically superior GPS solution [that will] be affordable to all. CSR's customers are enthusiastic for GPS at this much lower price point and I am confident we will see a significant increase in mobile handset attach rates for GPS and location based services.
"Our focus remains on the handset market and we are executing on our strategy to add value beyond Bluetooth in the phone. We will continue to invest both organically and via complementary acquisitions to further improve our product offering, enhance our customer proposition and maintain our competitive advantage."
NordNav, based in Sweden, has been acquired for an initial cash outlay of $40m. Up to a further $35m in cash may be payable if certain performance targets are hit by NordNav.
CSR paid $35m in cash for CPS, which is also based in Cambridge.
Both NordNav and CPS were private companies, principally owned by venture capital. The acquisitions will both be financed from CSR's existing cash resources.
First GPS product soon
CSR expects to offer its first GPS products during the first half of 2007 and anticipates both acquisitions will be earnings enhancing in 2008.
The company said the acquisitions were a further step in its strategy of diversification which already includes WiFi, FM, UWB (Ultra-Wide Bluetooth) and WiBree.
NordNav brings to CSR a world-class software based GPS solution. CSR will combine this with CPS's specialised location system technology to deliver significant performance benefits over traditional standalone GPS offerings including the ability of the CSR solution to work indoors, in deep urban areas and provide a shorter location fix.
The independent ABI Research forecast that the number of GPS chips shipping into mobile phones will increase at 45% a year between 2006 and 2011 to around 200m chips. CSR expects its low cost software based GPS will drive an increased penetration into mobile phones.
NordNav has already successfully implemented an embedded software receiver for mobile GPS positioning whose operational performance is as good as industry standard hardware centric implementations. CPS's technology is able to provide a shorter time to first fix, which reduces satellite acquisition time and provides power savings. Both companies have substantial patented intellectual property.
CSR expects its first GPS product offerings to enable satellite navigation and other location-based services. CSR's GPS technology will also support the Galileo standard. CSR will be demonstrating its GPS technology at 3GSM in February 2007.
As well as bringing a significant new product offering, the acquisitions will provide CSR with significant additional research and development engineering talent.
In total, over 40 employees have transferred to CSR from NordNav and CPS.
16th January 2007
