Cirrus Logic Inc, the struggling chip maker from Fremont, California has announced plans to spin off another of its non- core business units as a separate company, this time the 40 employee PC modem business. Cirrus is paring down its organization following poor results, and plans to focus on its core business of making chips for precision linear and mixed signal system-level processing, which it says are higher margin. The PC modem business is being extricated from the group in the form of a management buy-out. A new company, called Ambient Technologies Inc, has been formed to house the business and Cirrus said it would maintain a minority equity interest in the venture. The source of funding and other financial terms of the buy-out were not disclosed, although Cirrus did say that the division’s revenues represented 6% of the group, which when based on the latest six-month figures is around $40m. No information was given regarding the division’s profitability. The news follows a similar announcement last week which saw Cirrus spin off its communications business into another new venture called Basis Communications Inc (CI No 3,529). A spokesperson for Cirrus also confirmed that one more division was scheduled for similar treatment by the end of the year. Discussions regarding the future of the group’s poorly performing semiconductor fabrication joint ventures with IBM Corp and Lucent Technologies Inc (Mircus and Cirent Semiconductor) were still ongoing the company said.
