Dutch semiconductor company NXP has decided to close down its Israel center in Herzliya and lay off 150-200 employees - a difficult number to absorb in the high-tech employment market, where competition for every job is so intense.
The NXP center was originally Motorola Semiconductor, before it was acquired a decade ago by US chip company Freescale. Freescale was acquired in turn by private equity funds in a giant $17.6 billion deal. The company held an offering in the US in 2011, but the cyclical nature of the semiconductor market was not kind to the company and its business, which last year was sold again, this time to Dutch company NXP for $11.8 billion in cash and NXP shares.
In its announcement of the acquisition, NXP said that the merger between the two companies (NXP has a $29 billion market cap) would save $500 million a year in costs, and it appears that the closing of the Israeli center is part of this streamlining plan. As far as is known, NXP will retain marketing and sales activity in Israel, but no R&D.
According to the NXP Israel website, Freescale is the global leader in the communications processors market (number one in market share). The company develops, manufactures, and sells chips for the auto industry, the consumer and industrial market, and the networking and wireless market.
"The chips of Freescale Israel can be found in millions of products made by the world's largest communications companies. These products make up the Internet and cellular network infrastructure. The company focuses on development of communications chips that make it possible to connect people, computers, and cars to wire and wireless information arteries," the site states.
Published by Globes [online], Israel business news - www.globes-online.com - on January 1, 2016
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