Apple buys power management IP from Dialog Semi

October 11, 2018 // By Peter Clarke
Apple buys power management IP from Dialog Semi
European fabless chip company Dialog Semiconductor plc has announced a deal that will see it transfer 16 percent of its workforce to Apple, while receiving license fees and prepayment for three years of products.

In return Dialog is set to be paid $600 million and will then its focus on opportunities to supply configurable mixed-signal, audio and charging ICs into the Internet of Things (IoT), mobile, automotive, computing and storage sectors.

Dialog described the deal as a strengthening of its partnership with Apple while adding that it would continue to deliver PMICs to other customers globally.

Under the terms of the deal Dialog will license certain of its power management technologies to Apple, transfer assets and over 300 employees to Apple to support chip R&D in return for $300 million in cash. Apple will pay another $300 million for the development and supply of power management, audio subsystem, charging and other mixed-signal ICs to be delivered over the next three years. The revenue for contracts is expected to be realized in 2019, 2020 and 2021.

Dialog said the engineers and other employees that represent 16 percent of the Dialog workforce are already supporting Apple chip development and have done so for many years. Apple will also be taking control of Dialog facilities in Livorno (Italy), Swindon (UK), Nabern and Neuaubing (Germany). 

Dialog said that having made the changes it intends to transform the company to become a market-leading provider of differentiated custom and configurable mixed-signal ICs across a broader customer base. While that may continue to include mobile it will also see a focus on IoT, automotive, computing and storage markets.

Dialog pointed out that in these markets are expected to show a compound annual growth rate of 13 percent over the next few years to reach $13 billion in annual revenues by 2021.

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