DOC will pay approximately $23M in cash for "certain assets" of Flextronics's camera module business located in Zhuhai, China. The transaction, which is expected to close in Q3 2012, if not sooner, includes existing customer contracts and a lease to an approximately 135,000-square-foot facility. The transaction also includes an intellectual property assignment and license agreement, and a transition services agreement. DOC intends to offer employment to a portion of the existing work force of the Flextronics camera module business in Zhuhai, China. DOC anticipates that the business will have a capacity to manufacture approximately 50M camera module units per year.
Flextronics will retain a portion of Vista Point Technologies assets, but repurpose them and focus engineering talent toward "strengthening its ability to deliver manufacturing services".
"The Zhuhai Camera Module Business will allow us to drive rapid market introduction of DOC's next-generation technology in a manner that complements our existing collaborations with camera module makers. We believe our approach is the best way to address the requirements of Tier One OEM manufacturers, which require that camera modules be delivered through dual sourcing from high-volume manufacturing facilities," said Robert A. Young, Tessera CEO.
"This transaction is a critical step in our strategy of transforming DOC from an optical and image enhancement software and components business into a Tier One qualified, vertically integrated supplier of next-generation camera modules to the $9-billion market for mobile cameras," Young continued. "In parallel, we continue to have active discussions with multiple Tier One OEM manufacturers of mobile phones regarding our MEMS autofocus product, and remain on track to obtain a design win in the first half of 2012 and to begin high-volume manufacturing in the fourth quarter of 2012," said Young.
"These assets will enable DigitalOptics Corporation to significantly increase sales of the imaging technologies we've acquired and developed over the past five years. Our strategy is to combine our breakthrough autofocus solutions with our other proprietary technologies so that DOC will become a leading supplier of integrated camera modules in the mobile phone market," said Bob Roohparvar, president of DigitalOptics Corporation.
DOC has been developing its capacity to oversee the high-volume manufacturing operations required by mobile phone makers. DOC's steps in the past year have included hiring more than a dozen executives and managers who have experience in engineering scale-up as well as in manufacturing at similar facilities.
Thanks to SF for sending me the news!
