Electronics company LSI Corporation signed an agreement on Wednesday to acquire US-based fabless semiconductor manufacturer SandForce for $322m. In addition, LSI will assume $48m in unvested stock options and unrestricted shares held by SandForce employees.
LSI was previously one of nine investors in SandForce’s November 2009 series C round, which raised $21m, and was among six backers to contribute to the firm’s $25m series D round in September 2010.
LSI’s WarpDrive products also currently use SandForce’s flash storage processors in their flash adapters and solid-state drives. Upon completion of the acquisition, SandForce staff will become part of a newly formed Flash Components Division at LSI, headed up by Sandforce’s chief executive.
Abhi Talwalkar, chief executive of LSI, said: "Flash-based solutions are critical for accelerating application performance in servers, storage and client devices. Adding SandForce’s technology to LSI’s broad storage portfolio is consistent with our mission to accelerate storage and networking. The acquisition represents a significant, rapidly growing market opportunity for LSI over the next several years."
The transaction is likely to be complete in the first quarter of 2012, subject to closing conditions and regulatory approval.