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Apple inks $600 mn pact with Dialog Semiconductor to build a faster chip

Apple will get a licence to some of the parts of its power management integrated circuits (PMICs), with transfers of some of its assets and 300 employees to support development and chip research.

Reported by: India TV Tech Desk, London [ Published on: October 12, 2018 11:58 IST ]
Image Source : PIXABAY/MATCUZ

Apple inks $600 mn pact with Dialog Semiconductor to build a faster chip

In order to build faster chips, Apple commits to $600 million in order to buy a part of Dialog Semiconductor. With its headquarters in London, the company also purchased products from the remaining part of the chipmaker.

According to the pact, Apple will get a licence to some of the parts of its power management integrated circuits (PMICs), with transfers of some of its assets along with 300 of its employees to support development and chip research.

According to a statement made by Dialog Semiconductor on Thursday, Apple will have to pay $300 million in cash and also prepay $300 million products that need to be delivered over the next three years.

"We believe that this transaction is in the best interests of our employees and shareholders who will benefit from a business with enhanced focus, strong growth prospects and additional financial flexibility to invest in strategic growth initiatives," Jalal Bagherli, CEO of Dialog, said in a statement.

TechCrunch reported, that although Dialog describes this as an asset transfer and licensing deal, but this could be Apple's biggest acquisition by far in terms of people.

With this deal in place, Apple could assume some of the Dialog facilities that are in Livorno (Italy), Swindon (UK), Nabern and Neuaubing (Germany).

"Dialog has deep expertise in chip development, and we are thrilled to have this talented group of engineers who've long supported our products now working directly for Apple," said Johny Srouji, Apple's Senior Vice President of Hardware Technologies.

"Our relationship with Dialog goes all the way back to the early iPhones, and we look forward to continuing this long-standing relationship with them," Srouji said.

Dialog said that the company has been awarded a broad range of new contracts via Apple for developing and supplying power management, audio subsystem, charging and other mixed-signal integrated circuits. 

With this new contract in place, the revenues are expected to be realised starting in 2019 and accelerating in 2020 and 2021.

Dialog also reported that the company would continue to deliver PMICs to other customers globally.

(With IANS inputs)

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