Samsung Buys U.K. Firm To Bolster Mobile Chip Business

Expected to close in the fourth quarter, the deal will transfer all of CSR's development operations within its handset connectivity and location division to Samsung, including a total of 310 employees. Samsung also be will granted ownership of 21 patents from CSR, including those for Bluetooth, Wi-Fi and mobile GPS technologies.

In addition to the $310 million for the acquisition of CSR's mobile unit, Samsung said it will pay $34 million for a 4.9 percent share of the company.

[Related: Samsung Launches Galaxy S III Smartphone ]

The deal extends Samsung’s pre-existing partnership with CSR, which is the main supplier of the GPS technologies found in its Galaxy S smartphones. Specifically, Samsung uses CSR's SiRFstarIV offering, a mobile tracking technology that can be used for both indoor and outdoor navigation.

Samsung's semiconductor unit has a history in the mobile market, most notably with its Exynos line of processors used in its Galaxy smartphones. In April, the Korean tech giant launched its latest Exynos 4 quad-core chip, said to reach speeds up to 1.4GHz and consume 20 percent less power than prior-generation Exynos processors.

Apart from its own line of smartphones, Samsung's mobile processors, which are based on the low-power architectures of U.K.-based chip licensor ARM, also are used in Apple's iPhone.

With its acquisition of CSR's mobile division, Samsung said it stands to broaden its existing processor portfolio and compete more aggressively against other smartphone chip makers, such as Qualcomm and Texas Instruments.

"This strategic partnership combines Samsung's world-class semiconductor technology with CSR's cutting-edge wireless connectivity and location expertise," said Stephen Woo, president of System LSI Business, Device Solutions, Samsung Electronics, in a statement. "By leveraging CSR's R&D capability, Samsung will strengthen its application processor platform and solidify its position as a leading semiconductor solutions provider."

Joep van Beurden, CEO of CSR, said the agreement with Samsung will help CSR evolve into a competitive and "higher-gross-margin platform" company in the mobile chip market.

"I believe that under Samsung's ownership the handset operations will be in a better position to prosper in the global handset market," van Beurden said in a statement.

PUBLISHED JULY 17, 2012