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Outbyte PC Repair FREERepair Windows errors before they cause bigger problemsFix Now →Outbyte Driver Updater FREEScan for outdated or missing drivers - takes under a minuteDriver Scan →Marvell announced its agreement to acquire the remaining shares of Israel-based networking software company RADLAN on February 6, 2003, valuing the announced consideration at $49.7 million. That figure was based on Marvell’s closing share price the previous day; it was not the deal’s eventual all-in cost. Marvell already owned 9% of RADLAN, and later filings record additional share and milestone payments.
When did Marvell buy RADLAN, and what did it pay?
Marvell announced a definitive acquisition agreement on February 6, 2003. It planned to pay for the remaining RADLAN shares and employee stock options with a combination of cash and Marvell common stock valued at $49.7 million, calculated using Marvell’s February 5 closing share price. Marvell already held 9% of RADLAN. Marvell’s announcement described the proposed transaction, not a final lifetime total.
The agreement also provided for up to approximately 1.0 million additional Marvell shares if performance goals were met, and 0.5 million warrants exercisable at $18.41. Marvell completed the acquisition on June 27, 2003; RADLAN became a wholly owned subsidiary and continued operating in Tel Aviv. The closing announcement confirms the completion date.
Why the final consideration exceeded the headline figure
Marvell’s 2006 Form 10-K later reported consideration issued at closing: 2,635,284 shares valued at $24.0 million, 313,926 vested options valued at $2.9 million, and warrants for 1,086,366 shares valued at $7.5 million. The filing also records subsequent RADLAN-related share issuances, including $47.4 million of shares on October 6, 2003, and $19.6 million tied to milestones on December 8, 2003. These later disclosures show why the $49.7 million announcement value should not be treated as the total eventual payout. Marvell’s 2006 Form 10-K provides the later accounting details.
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What did RADLAN make?
RADLAN was an Israel-based provider of embedded networking software. Its OpENS infrastructure software supported networking functions including Layer 2, Layer 3 and Layer 4 switching and routing. Rather than buying a consumer-facing product, Marvell was acquiring software technology and expertise to pair with its own semiconductor products. Marvell’s announcement describes RADLAN’s software and the intended combination.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.Why was the acquisition important to Marvell?
Marvell said the deal would combine its networking chipsets with RADLAN’s software to create integrated solutions for enterprise, access, wireless and storage-area-network (SAN) markets. The strategic logic was to bring hardware and embedded networking software together, enabling Marvell to offer customers a more complete networking platform.
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At the time, Marvell president and CEO Dr. Sehat Sutardja said the combination of Marvell’s mixed-signal integrated circuits and RADLAN’s networking drivers, interfaces and software modules would let the company offer “a new class of silicon solutions” to customers. RADLAN CEO Jacob Zankel described the technologies as complementary and highlighted the same target markets. The acquisition announcement contains both executives’ statements.
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