QLogic Sold IB Assets to Intel

QLogic Corp. announced a definitive agreement to sell the product lines and certain assets associated with its InfiniBand business to Intel Corporation for $125 million in cash.

The sale is expected to close within this quarter, following the satisfaction of regulatory requirements and other customary closing conditions.

"The sale of these InfiniBand assets will benefit our shareholders by enabling us to provide better focus and greater investment in growth opportunities for the data center with our converged networking, enterprise Ethernet, and storage area networking products. After the sale, our cash position will be further strengthened and we expect the impact on earnings per share to be neutral," said Simon Biddiscombe, president and chief executive officer, QLogic. "In addition, the sale of these assets to a leading technology innovator and recognized HPC leader will provide a greater investment stream in high performance fabrics for InfiniBand partners and customers."

Comments

QLogic entered into IB in 2006 with the acquisition of PathScale, in IB host channel adapters, for $109 million, and then SilverStorm Technologies, in IB connectivity, for $60 million. The total is smaller than the price paid by Intel.

OEMs included Dell, HP, IBM and SGI.

Qlogic was offering adapters, switches, software and other products for this fabric technology mainly used for HPCs, a small but growing market.

But there is now a very small number of IB products and only one independent vendor, Mellanox, also in 10GbE connectivity like QLogic.

Looking at the list published by the InfiniBand Trade Association, there are now only three manufacturers (not including Intel/QLogic) of IB switches: Cisco, Flextronics and Mellanox (including acquired Voltaire); and just one for IB HCA cards: Mellanox.