Dialog Semiconductor has announced a deal with Apple to transfer 300 employees, licences, and 'certain assets' as the Cupertino-based company seeks to bring more of its parts design in-house.
That cash-rich Apple is keen to reduce its reliance on third-party suppliers for its components is no secret: The company has long designed its Arm-based mobile system-on-chip (SoC) parts in-house, of which the A12 Bionic is its latest design; last year it dropped Imagination Technologies' PowerVR GPU intellectual property (IP) in favour of its own efforts after talks to buy the company fell through; and it even owns its own semiconductor fabrication facility - though one designed for small-scale prototype runs, not full-scale production.
Apple's desire to have more control over the design and supply of its core components extends beyond the CPU and GPU, though: The company has entered into an agreement with Dialog Semiconductor which sees Apple become a stakeholder in exchange for staff, assets, and prepayment based on future purchases of the company's power management integrated circuits (PMICs).
'This transaction reaffirms our long-standing relationship with Apple, and demonstrates the value of the strong business and technologies we have built at Dialog,' claims Dialog chief executive Jalal Bagherli. 'Going forward, we will have a clear strategic focus, building on our custom and configurable mixed-signal IC expertise and world-class power-efficient design. Our execution track record, deep customer relationships, and talented employees give us great confidence in our future growth prospects. 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.'
The deal goes beyond a simple purchase agreement: Apple will pay Dialog $300 million in exchange for a licence agreement for selected PMIC licences, will receive unspecified 'certain assets', and will directly employ 300 Dialog staff, while a further $300 million is being provide as pre-payment on future PMIC orders.
'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,' claims Apple's Johny Srouji of the deal. '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.'
The deal is expected to close in the first half of 2019.
October 14 2019 | 14:00