Business Acquisition

12 Months Ended

Apr. 03, 2011


Note 2.	Business Acquisition

On April 27, 2009, the Company acquired NetXen, Inc. (NetXen) in a merger transaction. Cash consideration was $17.6 million for all outstanding NetXen capital stock. NetXen developed, marketed and sold Ethernet adapter and controller products targeted at the enterprise server market. The acquisition expanded the Company’s product portfolio to include Ethernet networking products that are complementary to existing products. The acquisition also expanded the Company’s expertise to better address a wider range of emerging customer requirements for converged and 10Gb Ethernet products. The acquisition agreement required that $5.1 million of the consideration be placed into an escrow account in connection with certain representations and warranties, of which $3.5 million has been distributed to the original shareholders of NetXen. The remaining $1.6 million in escrow is expected to be released during fiscal 2012. The escrowed amounts have been accounted for as cash consideration as of the date of acquisition.

The following table summarizes the allocation of the purchase price to the fair value of the assets acquired and liabilities assumed:


	(In thousands)

Cash	$	2,659
Accounts receivable		716
Inventories		1,030
Property and equipment		854
Goodwill		889
Identifiable intangible assets		6,410
Deferred tax assets		8,302
Other assets		352
Accounts payable and other liabilities		(1,751	)
Accrued compensation		(937	)
Line of credit		(934	)

	$	17,590

A summary of the purchased intangible assets acquired as part of the acquisition of NetXen and their respective estimated useful lives are as follows:


	Weighted
	Average
	Useful Lives
	(Years)		Amount
			(In thousands)

Intangible Assets:
Core technology		7	$	5,400
Contractual licenses		5		1,010

			$	6,410

The results of operations for NetXen have been included in the consolidated financial statements from the date of acquisition. Pro forma results of operations have not been presented as the results of operations for NetXen are not material to the consolidated financial statements.