Independent foundry TowerJazz (Nasdaq: TSEM; TASE: TSEM) is expanding its agreement with fabless semiconductor company Entropic Communications Inc.
Market sources say that the expanded deal makes Entropic one of TowerJazz's five biggest customers, and potential sales to Entropic can reach $50 million per year.
Entropic focuses on the home entertainment industry. The expanded supplier capacity agreement will add to Entropic’s direct broadcast satellite (DBS) and TV tuner product lines. The expanded agreement assures high-volume production for Entropic’s family of outdoor unit (ODU) silicon.
Entropic’s ODU technologies create a single cable network that reduce cost and installation complexity for DBS operators, which supports distribution of high definition (HD) content, and prepares operator systems to further expand home networking application offerings.
TowerJazz will also expand its manufacturing capacity to support Entropic’s family of digital TV tuner solutions.
Entropic senior VP operations and engineering Mike Farese said that with an increase in the volume of production for its DBS ODU and tuner products, "We entered into a new supply agreement with TowerJazz to meet the expanding needs of our customers."
As part of the agreement, TowerJazz will expand its wafer fabrication capacity at its Newport Beach, CA facility for Entropic products, and will also support a program to achieve greater production of Entropic’s ODU and silicon TV tuner products at its production facility in Migdal Ha'emek.
Migdal Ha'emek-based TowerJazz is led by CEO Russell Ellwanger.
Tower Semiconductor Ltd. does business as TowerJazz since acquiring Jazz in 2008. The company's share price closed yesterday at $1.42, giving a market cap of $327.68 million.
Published by Globes [online], Israel business news - www.globes-online.com - on October 19, 2010
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