I was quite surprised to read the news today that Tessera Technologies will acquire DTS for approximately $850 million in an all-cash transaction. Of course, virtually all AVS Forum members know DTS for its audio technologies, including various codecs, DTS:X and Headphone:X immersive sound, and PlayFi wireless-audio system that is now being adopted by several manufacturers.
But I bet few know Tessera Technologies. Founded in 1990 by three IBM scientists, Tessera originally focused on the research and development of semiconductor-packaging technology. As the company grew and evolved, it formed the subsidiary Invensas, an innovator in next-generation semiconductor and packaging technologies. Tessera also expanded its business through the acquisition in 2008 of FotoNation, a leader in image and video enhancement and analysis. Now headquartered in San Jose, CA, the company's customers include many of the world's leading semiconductor, smartphone, and digital imaging manufacturers.
As Tessera's CEO Tom Lacey says in the press release, "Our acquisition of DTS's talented team and industry-leading products will represent a transformational step in the execution of Tessera's strategic vision, with exciting new product development and marketing opportunities. Our complementary technology portfolios are ideally suited to deliver the next generation of audio and imaging solutions to mobile, consumer electronics, and automotive markets while expanding our ability to address incredible new opportunities in IoT and AR/VR. I am particularly excited that Jon Kirchner and the exceptional DTS team will join the Tessera family as we continue to grow and expand the DTS brand."
DTS chairman and CEO Jon Kirchner echoes Lacey's remarks, adding, "This is an exciting transaction that provides substantial and immediate value to our shareholders. We look forward to working closely with Tom and the Tessera team to achieve a smooth integration and pursuing the attractive opportunities ahead. We believe that, as part of Tessera, we will be in a unique position to deliver the world's leading audio and imaging solutions to all of our key markets and drive meaningful value for our combined customers, partners, and employees."
This seems like it could be a good match, pairing DTS's expertise in audio technology with Tessera's long history of semiconductor design and imaging technology. The combined company could become a one-stop shop for the audio and video infrastructure that will underlie many products in the future.
The transaction is scheduled to be completed by the end of this year or the beginning of 2017. Here's hoping it benefits not only the companies and their shareholders, but consumers as well.
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