Microsemi Corp sells off assets of Semicoa

CALIFORNIA, USA: Microsemi Corp., a maker of chips for military, aerospace and industrial uses, said on Thursday it has sold the assets of another chip maker Semicoa Semiconductors Inc. that it acquired from the latter on July 14, 2008. Semicoa is a manufacturer of variety of QML semiconductors.

The move is as part of a settlement with the Department of Justice, which said that without this divestiture, there would be little or no competition in the development, manufacture and sale of certain semiconductor devices used in military and space programs essential to the security of the US, says media reports.

These semiconductor devices, small signal transistors and ultrafast recovery rectifier diodes, are used to control the flow of electric current. Both small signal transistors and ultrafast recovery rectifier diodes are used in critical military and civil applications ranging from satellites to nuclear missile systems.

Prior to the acquisition, Microsemi and Semicoa were the only manufacturers of small signal transistors qualified for these applications.

Alleging that Microsemi's acquisition of Semicoa's assets would result in increased prices and slower delivery of critical military components, the Department's Antitrust Division had filed a proposed settlement in U.S. District Court for the Eastern District of California.

The proposal, if approved, would resolve the lawsuit and address the Department's competitive concerns. And thus, it will result in more competent products from these players.

Microsemi said the transaction will not have a material effect on the company's current quarterly results.

Microsemi’s latest action stems from this. It has been pointed out by US sources that Microsemi will now provide additional details of the sale when it releases its September quarter and year-end results. They said that Microsemi's settlement with the Justice Department will be subject to final approval under procedures set out by the federal law.