DSP Communications Inc – which develops chipsets and other products for the Personal Communications Services (PCS) market – is moving its wireless expertise into the LAN arena, through the acquisition of market leading wireless LAN supplier Proxim Inc (CI No 3,031). DSP plans to issue 0.70 shares of its common stock for each outstanding share of Proxim, valuing the deal at around $400m. Mountain View, California-based Proxim is the developer of the frequency hopping spread spectrum-based RangeLAN2 wireless local area network system, which operates in the 2.4GHz frequency band. DSP develops, markets, and licenses application-specific integrated circuits and Digital Signal Processing-based technology for cellular and personal communications services applications. Last year, it acquired CTP Systems Ltd, a specialist in wireless voice solutions aimed at office and low mobility applications. David Gilo, chairman of DSP says that building on this acquisition, Proxim offers the company the chance to expand these applications, and enter the wireless data market as well. Also, he added, it gives DSP the opportunity to be a player in the systems, business, not just component products. Speaking for Proxim, David King, the company’s chairman, president and chief executive officer, hinted that these voice technologies will be integrated with RangeLAN2, allowing DSP to offer integrated wireless voice and data solutions. DSP hopes to account for the transaction as a tax-free reorganization and a pooling of interests. The companies are aiming to close the deal by the end of next January.
