Alphawave IP in $240m deal for Israeli optical DSP firm

Alphawave IP in $240m deal for Israeli optical DSP firm

Business news |
By Nick Flaherty

London-based Alphawave IP Group has bought Banias Labs, an Israeli developer of optical Digital Signal Processing (DSP) chips for data centres in a deal worth US$240m (€240m)

The deal strengthens Alphawave’s roadmap of optical DSP silicon products for data centres, resulting in a non-binding, multi-year purchasing framework with a leading North American hyperscaler to develop and sell a portfolio of optical products and DSPs. This includes coherent DSP technology from Banias Labs, with sales potentially ramping to over US$300m. 

Alphawave says it is committed to becoming an industry leader in the area with a broad portfolio of PAM4 and Coherent DSPs for all forms of data centre connectivity.

It expects the ramp of new Optical products to start in 2024 and profitability to improve from 2023 levels as products go into high-volume production and generate additional revenue.

Coherent optics is key to 800G and 1.6T Ethernet speeds while maintaining the required reaches inside and outside of data centres and also significantly reducing power consumption and is predominantly used today in long reaches of over 100km connecting data centers and in telecommunications. Banias Labs’ optical DSP technology strengthens Alphawave’s optical products roadmap by targeting a growing opportunity for coherent optical technology inside the data centre, with shorter reach links inside and between racks.

“Banias Labs optical DSP technology provides a strong strategic advantage for Alphawave, strengthening our roadmap of DSP silicon solutions for data centres,” said Tony Pialis, President and Chief Executive Officer of Alphawave. “This acquisition enhances our portfolio of electrical and optical solutions in the most advanced process technologies. The multi-year purchasing framework includes coherent optical solutions, and with the Banias acquisition, Alphawave is expanding its total addressable market by delivering next generation coherent optical solutions for the most advanced data centres.”

Banias Labs was only founded in 2020 and has 50 staff based near Tel Aviv. It was set up by Avigdor Willenz, CEO Amnon Rom from Toga Networks, Amri Levy, Alex Shinkar and Or Vidal.

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