According to the Financial Times Deutschland, Infineon has hired US investment bank J.P.Morgan to look for a buyer of its wireless business which could fetch $1.3bn. Reportedly, a data site for potential buyers has been opened.
The report follows recent speculation that Intel was after buying the business unit in another attempt by the Santa Clara to get into the wireless IC industry.
If Intel was unwilling to pay around $1bn for the unit, which had revenues of $1.13bn last year, it may explain why Infineon is now looking for other suitors.
If it appears that Broadcom, Marvell or MediaTek are interested in the unit, then a bidding war, orchestrated by J.P.Morgan could maximise the price.
Selling wireless businesses is difficult. While NXP managed to get $1.6bn from ST-Ericsson for its wireless assets, Freescale was unable to find a buyer when it put its wireless business up for sale and, eventually, split up the business unit and closed most of it down.
At the time NXP sold its wireless business to ST-Ericsson last year, it was said that it was necessary to spend $1bn a year on R&D to stay in the wireless business. Qualcomm, the market leader, spends closer to $2bn a year.
Yet the market for wireless chip-sets is largely commoditised, with rapid price erosion even on high-end chip-sets.
Infineon’s wireless business has been particularly successful with a design win in the Apple iPhone.