EZchip To Buy Tilera

(RTTNews) - EZchip Semiconductor Ltd. (EZCH) said Tuesday that it has agreed to buy Tilera Corp., a privately-held US-based company that develops high-performance multi-core processors, intelligent network interface cards and white-box appliances for data-center networking equipment.

Under the deal, EZchip will pay Tilera's stockholders up to $130 million in cash; of which $50 million is payable at closing and up to an additional $80 million is payable subject to the attainment of certain future performance milestones.

The deal, which has been approved by the EZchip and Tilera boards of directors, is expected to close in the third quarter of 2014.

The acquisition is intended to provide significant new growth opportunities for EZchip by accelerating its expansion into new markets, diversifying its customer base and product lines and doubling its target Total Available Market.

EZchip currently expects the acquisition to be neutral to slightly dilutive in 2014 and accretive in 2015 to its adjusted earnings per share.

Following the closing, Devesh Garg, the CEO of Tilera, will serve as EZchip's President in charge of all US operations.