Xilinx Acquires Modesat Communications (XLNX)

Employing fifeteen people, Xilinx also has office in San Diego, California, which will continue operations after the acquisition as well.

Post integration, the combined product portfolio of Xilinx will enable original equipment manufacturers (OEMs) focusing on mobile backhaul platforms to gain market competitiveness and product differentiation.

Xilinx’ solutions provide fast and efficient alternatives for OEMs, who are constrained with respect to limited merchant IP options as customers can retain their proprietary IP, while deploying backhaul solutions and the flexibility of Xilinx All Programmable FPGAs and SoC devices to move its products to the market faster.

The OEMs continue to show increasing interest in e-Band and NLOS backhaul technologies, beyond traditional microwave backhaul. Hence, the acquisition should benefit Xilinx to capitalize on this demand.

Earlier, Xilinx acquired PetaLogix, a supplier of embedded Linux solutions. The company will now be able to offer the best-in-class, improved and modified Linux solutions to its clients with the help of PetaLogix’s advanced PetaLinux technology.

Management believes that the PetaLogix acquisition will establish the company firmly in the vertical market and will substantially strengthen its position in the embedded market. PetaLogix is largely responsible for augmenting the demand of Xilinx’s programmable techniques in the embedded market.

Previously, PetaLogix distributed Linux solutions for various processors such as MicroBlaze and PowerPC and now with the acquisition, it will provide Linux solutions and techniques to the Zynq-7000 All Programmable SoC.

Xilinx designs and manufactures a broad range of high-performance, high-density programmable logic devices (PLDs), such as field-programmable gate arrays (FPGAs) and complex-programmable logic devices (CPLDs). Xilinx is a key semiconductor supplier to the leading OEMs in wireless mobile backhaul markets.

We currently maintain an Underperform recommendation on the stock. The company currently carries a Zacks #2 Rank, which denotes a short-term (1-3 months) Buy rating.