Tech company, local firm merge

After almost two years of searching for a technology company that would fit the vision of his business, a former Apple Computer executive from Corona del Mar has entered into a merger with Jazz Semiconductor Inc.

The deal, with an estimated value of $260 million, is scheduled to be completed by early 2007. Gil Amelio, Acquicor’s chief executive, still needs the greenlight from the Securities and Exchange Commission and the company’s stockholders, and must go through other standard procedures before the deal is official.

Amelia set up Acquicor, a public company made up of investors, as a special-purpose-acquisition corporation almost two years ago to purchase a technology company. He said Jazz was attractive because it serves the most exciting markets.

Jazz, a manufacturer of analog and mixed-signal semiconductor devices, will become a wholly owned subsidiary of Acquicor when the deal is completed.

Jazz manufactures chips for consumer electronic products, including many wireless devices such as cellphones. These chips make it possible to integrate services such as e-mail, global positioning systems, messaging and cameras into the products. The company also makes the semiconductors for TVs, DVD players and other digital products.

Acquicor has raised over $172 million and is shopping the market for additional funding. Amelio said Wachovia has committed to funding $65 million, and the sellers, which include the Carlyle Group, have promised to make up the difference if needed.

“We have other sources of capital and expect that by closing to have that taken care of,” Amelio said. “We haven’t decided on one particular method, but we’re going with some type of third-party financing.”

Jazz was looking to become a public company and Chief Executive and President Shu Li saw this offer as a simplified way to accomplish that.

“We’re at a stage where we require significant growth and expansion and that requires capital, and going public is one way to have access to a lot of capital,” Li said. “So when we heard about this, this is definitely an attractive way of going public, and at the same time we also have a requirement to return some investments to our shareholders like Carlyle and Conexant.”

Both Newport Beach-based Conexant and Carlyle Group have invested in Jazz earlier.

So far both companies’ customers and investors have reacted positively to the news.

“I’m glad to see Jazz can focus on future growth,” Li said.