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  • Portfolio News
  • 10 June 2013
  • 15 min read
  • Words: Northzone

Silicon Labs acquires Northzone portfolio company Energy Micro for $ 170 million

Oslo, June 10th 2013 – Northzone is pleased to announce the sale of portfolio company Energy Micro, the leader in energy-friendly MCU and radio solutions, to NASDAQ listed Silicon Labs. The entity’s combined portfolio of products will continue to power the Internet of Things, Smart Energy and Portable Electronics. Northzone, together with Investinor, has been an investor in Energy Micro since March 2010, and has achieved a 50% IRR multiple on its investment in this late stage market leading semiconductor provider.

Torleif Ahlsand, General Partner in Northzone, has been Chairman of Energy Micro since the initial investment. Northzone invested in the company with Investinor whilst Energy Micro was in the process of developing the second generation of its microcontroller family, after entering the market with its first product, the 32-bit EFM32 Gecko, only 6 months earlier. “Energy Micro was the first investment for Northzone VI, and it has been a very exciting journey. Geir and his team have built a great and truly innovative and disruptive business. This sale marks an important milestone not only for our Fund, but also the overall semiconductor market.” adds Torleif Ahlsand, General Partner at Northzone.
Based in Oslo, Norway, Energy Micro offers the industry’s most power-efficient portfolio of 32-bit microcontrollers (MCUs) and is developing multi-protocol wireless RF solutions based on the industry-leading ARM® Cortex-M architecture. Energy Micro’s energy-friendly MCU and radio solutions are designed to enable a broad range of power-sensitive applications for the Internet of Things (IoT), smart energy, home automation, security and portable electronics markets.

This strategic acquisition accelerates Silicon Labs’ (Nasdaq: SLAB) growth opportunities and positions the company as the foremost innovator in energy-friendly embedded solutions. The growth of the IoT market, coupled with continued deployment of smart grid and smart energy infrastructure, is driving strong demand for energy-efficient processing and wireless connectivity technology to enable connected devices in which low-power capabilities are increasingly important. Industry experts predict that the number of connected devices for the IoT will top 15 billion nodes by 2015 and reach 50 billion nodes by 2020.

“Silicon Labs and Energy Micro share a complementary vision of a greener, smarter, wirelessly connected world, and the foundation for this combined vision is ultra-low-power technology enabled by each company’s innovative mixed-signal design,” said Tyson Tuttle, president and CEO of Silicon Labs. “This acquisition combines two proven leaders in nano-power MCU and wireless SoC design into a formidable force that will accelerate the deployment of energy-friendly solutions across the Internet of Things and smart energy industries.”

“The Energy Micro team is excited to join Silicon Labs,” said Geir Førre, president and CEO of Energy Micro, who after the closing, will become vice president and general manager of Silicon Lab’s Energy-Friendly Microcontroller and Radio business unit, based in Oslo.

Under the agreement, the shareholders of Energy Micro will receive an up-front payment of $115 million in cash, plus approximately $55 million in deferred and earn-out consideration. Energy Micro is expected to contribute approximately $7 million in revenue in the second half of 2013 for Silicon Labs. The boards of each company have approved the acquisition, which awaits the satisfaction of customary closing conditions. The deal is expected to close in July 2013.

About Energy Micro
Energy Micro, based in Oslo Norway, develops and markets the world’s most energy-friendly microcontroller and radio products based on ARM Cortex-M processor cores. Consuming a quarter of the energy of competing products, the company’s award-winning EFM32 Gecko MCUs and EFR4 Draco radios target energy-sensitive applications across the embedded industry and are supported by Energy Micro’s developer-friendly Simplicity Studio, which can reduce embedded system development times by a half. The company was founded in 2007 by experienced semiconductor professionals with previous expertise from Chipcon, Texas Instruments, Atmel and Nordic Semiconductor. Energy Micro is backed by Northzone and Investinor. For more information about Energy Micro, visit www.energymicro.com
About Silicon Labs
Silicon Labs is an industry leader in the innovation of high-performance, analog-intensive, mixed-signal ICs. Developed by a world-class engineering team with unsurpassed expertise in mixed-signal design, Silicon Labs’ diverse portfolio of patented semiconductor solutions offers customers significant advantages in performance, size and power consumption. For more information about Silicon Labs, please visit www.silabs.com.

About Northzone
Northzone is a leading technology investment fund. The partnership has since 1996 been chosen by some of Europe’s most exceptional entrepreneurs as a long-term partner for growth, and has expanded to dominate the north European investment market. Notable investments include Spotify, Nimsoft, Avito, Lastminute, Stepstone, Tobii and Pricerunner.

For more information contact Torleif Ahlsand: ahlsand@northzone.com