OCZ today surprised the tech industry by announcing it had acquired controller chip manufacturer Indilinx for $32 million.
OCZ paid for the deal with shares in the company, meaning that former Indilinx shareholders now own a substantial 9.5 per cent stake in OCZ Technology Group Inc. The deal also safeguards all facets of the Indilinx business, with its founder and president Bumsoo Kim remaining in charge of the company’s 45 employees.
One motivation for the deal on OCZ’s part seems to be the acquisition of around 20 patents and patent applications, which are currently held by Indilinx.
OCZ also claims that the deal will ‘extend OCZ's capabilities with advanced controller technology including Tinkerbell, a high performance eMMC 4.4 x controller that replaces SSDs in consumer electronic devices such as smartphones, tablet PCs, GPS units and netbooks.
The move also raises the question of what OCZ has planned for its SSD business. The company has had a long-standing relationship with both Indilinx and SandForce, and both companies have supplied controller chips for various parts of OCZ’s SSD range.
OCZ has attempted to reassure partners such as SandForce via a press statement, which firmly states that it will still continue to use other controller chips, and that Indilinx will still continue to supply chips to other SSD manufacturers. How long this is likely to last is up for debate, though, as OCZ will want to see a tangible benefit from its purchase at some point.
Is this acquisition a good move for OCZ, or is it nuts to buy a company and continue using a competitor’s product? Let us know your thoughts in the forums