GO
Loading...

LSI to Sell Mobile Chip Business to Infineon for $450 Million in Cash

Monday, 20 Aug 2007 | 5:35 PM ET

Chipmaker LSI rose 4 percent after the closing bell on Monday after the company said it would sell its mobile phone chip business to Germany's Infineon Technologies.

The Milpitas, Calif.-based company said it will sell its mobility products business to Infineon for $450 million in cash with potential performance-based incentives of up to $50 million, payable in the first quarter of 2009.

"The sale of our mobility business will allow us to further focus our efforts on attractive market opportunities in storage and networking, where we have a strong presence, significant differentiation and the scale needed to be successful over the long term," said Abhi Talwalkar, LSI chief executive officer, in a prepared statement.

Shares of LSI rose to at $6.41 in after-hours trading after closing on the New York Stock Exchange at $6.18.

LSI said a portion of the proceeds of the sale will be used to fund a new $500 million stock buyback plan.

The company formerly known as LSI Logic changed its name to LSI following its merger with Agere Systems last April.

  Price   Change %Change
IFX
---
LSI
---

Featured

Contact U.S. News

  • CNBC NEWSLETTERS

    Get the best of CNBC in your inbox

    › Learn More

Don't Miss

U.S. Video

  • Mad Money's Jim Cramer discusses Micron Technology and how the company gained control over inventory issues. The bears expect the company's history to repeat itself, but Cramer says this time, it feels different.

  • In this excerpt from a live CNBC interview, Warren Buffett explains why it's extremely unusual for a company's directors to vote against executive compensation plans.

  • Mad Money host Jim Cramer says shareholder activism works for every shareholder, and offers his take on the Valeant/Bill Ackman bid to acquire Allergan. The market is better off for these efforts, he says.