May 22, 2012 – Silicon Laboratories (Country Manager Jong-Chan Lee), a global leader in high-performance analog-intensive mixed-signal ICs, announced today that it has reached a definitive agreement to acquire Boston-based Ember Corporation for $72 million. This acquisition price is subject to change based on adjustments to working capital and potential future settlements. Ember is a mature, privately held company that supplies silicon, software, and development tools leading the market for 2.4GHz wireless mesh networking solutions for smart energy, connected home, security, lighting, and other monitoring and control applications.

Through this strategic acquisition, Silicon Labs has secured technology and software expertise in the field of low-power mesh networks, which are being applied in a wide range of residential, commercial, and industrial applications today. The demand for low-power, small-footprint wireless technology is accelerating as more IP-enabled endpoints (terminals, communication devices) connect to the Internet. Internet-connected devices, which are expected to reach an annual market size of 10 billion for the first time, are enabling more convenient, energy-efficient, and secure home and work environments.

Ember's product line complements Silicon Labs' products and targets a market expected to grow from $100 million in 2012 to $600 million in 2016. Silicon Labs, through combination with Amber products
We have built a comprehensive portfolio of highly integrated networking solutions for embedded systems that encompasses technologies such as microcontrollers (MCUs), power and isolation technologies, sensors, and sub-GHz and 2.4GHz wireless communication.

"Silicon Labs President and CEO Tyson Tuttle said, 'Silicon Labs has continued to successfully integrate and mass-produce high-performance, low-power RF and mixed-signal ICs into CMOS and bring them to market. By acquiring an outstanding team with proven wireless mesh network know-how, we have further accelerated our ability to provide complete system solutions to our customers.'"

Ember is a market pioneer that has been developing mesh network technology since the early days when the concept of 802.15.4 ZigBee® mesh networks was established. Its design team is recognized for its unrivaled experience and expertise in the field of embedded wireless. Ember's products combine high-performance, low-power 2.4GHz wireless ICs with stable and scalable networking software to create a platform with superior performance and flexibility. Leveraging over 10 years of system and software knowledge applied in the connected home, smart meter, and building automation sectors, along with shipments of more than 25 million products, Ember has solidified its leadership in ZigBee-based systems and established benchmarks for performance and usability.

Ember CEO Bob LeFort stated, “Silicon Labs has focused on leading the industry in embedded wireless with its broad product portfolio, while Ember has secured many record-breaking achievements and technological leadership in Zigbee-based systems. I am confident that the combination of the two companies will accelerate growth for customers and the internet device market,” adding, “The shared vision, culture of harmony, and commitment to excellence will bring positive results for both the market and the Ember team.”

Silicon Labs expects its broadband-based business to expand rapidly through the addition of Ember's high-performance System-on-Chip (SoC) portfolio, cutting-edge networking software expertise, and proven design and application teams. Silicon Labs plans to extend the application of its underlying technology platforms and expertise for low-power mesh networking to industrial and commercial applications, as well as residential ones. Furthermore, as both companies plan to utilize a shared development environment, it is expected to accelerate roadmap integration and enable rapid deployment to existing customer bases.

Ember is expected to contribute approximately $10 million to $12 million in revenue in the second half of 2012 and anticipates revenue growth in 2013 on a non-GAAP basis. The boards of directors of both companies have approved this merger and are currently awaiting compliance with relevant requirements and the fulfillment of other closing conditions. In addition to this all-cash acquisition, the Silicon Labs board of directors has approved a $200 million management credit loan to be used for stock repurchases and other general corporate purposes.

Webcast - May 23, 2012
The investor conference call and presentation are scheduled to take place at the Sheraton New York Hotel on May 23 at 4:15 p.m. (Eastern Time) during Barclays Global Technology's Media and Telecommunications Conference. The presentation and audio webcast can be accessed via Silicon Labs' website at http://investor.silabs.com .