X-bit labs

Transmeta Licensees Processor Manufacturing to Third-Party.

Category: Mobile

by Anton Shilov

[ 06/01/2005 | 03:02 PM ]

Transmeta Corp. announced the signing of asset purchase and license agreements with Culture.com (Culturecom) Technology Limited, a Hong Kong-based technology company. Under the agreement Culture.com receives rights to make and sell Transmeta Crusoe processors as well as manufacture and sell Transmeta Efficeon processors at 130nm process technology in China.

“This relationship is another example of Transmeta’s commitment to deploy our innovative technologies through licensing and synergistic engineering services. This engagement helps deliver Transmeta processor technology to the rapidly growing Chinese computing market through Culturecom, an established provider of Chinese-language technology solutions,” said Arthur L. Swift, president and chief executive officer of Transmeta.

Pursuant to the agreements, Transmeta has agreed to sell, through a combination of asset purchase and licensing agreements, its Crusoe product line to Culturecom. As part of this agreement, Culturecom will also license Transmeta’s 130nm Efficeon technology to make and sell Efficeon-based products in China. In consideration, Culturecom will make up-front cash payments totaling $15 million to be escrowed pending the close of the transaction. In addition to the up-front payments, Culturecom will also pay royalties to Transmeta on sales by Culturecom of Crusoe and Efficeon products. The transaction is scheduled to close in the fourth quarter of 2005.

As part of this transaction, Culturecom will also enter into an engineering services agreement with Transmeta to facilitate the transfer of the technology. Previously, Culturecom licensed Transmeta's Midori Linux for the development of embedded applications and, in conjunction with that license, Transmeta acquired, and continues to own, a minority equity stake in Chinese 2 Linux (Holdings) Limited, an affiliate of Culturecom.

Transmeta will continue to manufacture its Crusoe and 130nm Efficeon products until the transaction closes, and will complete fulfillment of existing backlog in the subsequent transition period. As previously announced, Transmeta will continue to support its 90nm Efficeon processors for Transmeta’s strategic partners.