CSR is not exactly in our SITS sector but it interests me on a number of levels. Firstly, it is a relatively rare example of a UK HQed tech company with a global status. Secondly, it is a good example of what can come out of hubs – in this case Cambridge. Thirdly, I’ve known several of the people involved in its early development – Ron Macintosh and the sadly now departed Mike Shone.
CSR (Cambridge Silicon Radio) is “a leading provider of multifunction connectivity, audio and location platforms” ie Bluetooth, GPS, NFC. Formed in 1998 they listed in London in 2004 and became something of a stock market darling with their share price up six-fold to c1500p between 2004 and 2006. But, despite a series of acquisitions and being involved in perhaps the hottest of all sectors of the marketplace, by 2009 the share price had been ‘decimated’ to just 150p. Their ‘problem’ was that they never quite made it in smartphones. Indeed, both Bluetooth and GPS systems have since become commodity items.
In 2009 CSR bought SiRF – the world’s biggest supplier of GPS chips - for $136m.
Today, CSR has announced a ‘merger’ with US NASDAQ quoted Zoran. They are paying $695m– equivalent to a 40% premium on Zoran’s closing price on Friday. CSR hope the deal will allow them “to expand into internet-enabled, location-aware products like digital cameras and home entertainment products”.
On the one hand we applaud any UK HQed company taking these kind of steps. Location-based products are getting to be pretty hot as anyone who has tried to buy a digital camera or, indeed, has looked at any inane FourSquare Twitter feeds recently will testify. Conversely, it’s a pretty big ‘merger’ for CSR and has all the hallmarks of causing the dreaded Holway Acquisition Indigestion.
The market wasn’t too impressed either marking CSR down 8% at 396p.