ROHM Co., Ltd., a global analog power IC manufacturer, has acquired Powervation Ltd., a privately-held digital power IC manufacturer for approximately $70 million, in an all-cash transaction. The acquisition is expected to significantly expand ROHM’s market position in the digital power solutions market as analog technologies continue to be displaced by digital power.
ROHM is a global leader in analog and power semiconductors with $3 billion in revenues, targeting consumer, automotive and industrial markets. The acquisition is expected to help ROHM expand into a broader range of markets and applications with Powervation’s Intelligent Digital Power platform. The company’s digital power management system-on-chip (SoC) solutions will strengthen ROHM’s product offerings in the growing cloud, data center, and communications infrastructure markets. This will be driven by increased adoption of digital power in high-density systems and ICs, including microprocessors, memory devices, FPGAs and ASICs.
Powervation, which was founded in 2006 as a University of Limerick spin-out, is considered an innovator of digital power controllers for high-performance computing, cloud and communications infrastructure. The company’s proprietary DSP control platform consisting of its patented xTune auto-tuning and ITM intelligent transient management technologies, has been adopted in applications that call for advanced power management, precision telemetry/control and high-efficiency solutions to power complex multi-rail, multi-phase systems.
“ROHM and Powervation share a common vision for the role of digital power technology in transforming the market with next-generation high performance power solutions,” said Mike Smith, SVP & GM of ROHM Semiconductor USA, in a statement.
Digital power continues to displace traditional analog technology driven by its performance and energy efficiency advantages, according to the company. The early adopters include server, telecommunications, and datacommunications applications. As more sectors leverage the benefits of digital power it will drive increased opportunities and revenues, according to market research firm IHS. Global revenue for digital power ICs is expected to grow from $605 million in 2014 to $3.1 billion by 2018, according to a 2014 IHS report.
Adoption is being driven by several advantages over analog power. One of the biggest drivers of adoption is the reduction of the bill-of-materials cost, according to IHS analysts, which relates to reducing the number of discrete components, increasing power density, and lowering the carbon footprint. Other benefits include monitoring and optimizing power levels and system requirements in operation and speeding up time to market, said IHS.
There are no dominant players in the digital power supply market, according to the latest report from IHS. The big players, ranked in 2013, include Texas Instruments with an estimated 9.8 percent share, followed by Infineon with a 9.6 percent share and Powervation with an 8.9 percent market share.
The overall power semiconductor market grew 8.4 percent in 2014, reaching $11.5 billion, according to a recent report from Yole Développement (Yole). The market research firm forecasts the market to surpass $17 billion by 2020, representing a compound annual growth rate (CAGR) of 6.9 percent over the forecast period of 2014-2020.
Powervation will become a fully owned subsidiary of ROHM, with a principal design center in Cork, Ireland and system application centers in San Jose, Calif. and Asia. “ROHM plans to accelerate product development through investment and synergies with ROHM analog / discrete power technologies and to increase market adoption further by leveraging ROHM’s global customer base and channels,” said the company.
“The Powervation team is excited to join forces with ROHM, a top 25 global semiconductor company,” said Mike McAuliffe, CEO of Powervation, in a statement. “It’s simply a great fit - we have built an innovative Digital Power IC company to date but the combination with ROHM now presents a compelling opportunity for broad market leadership in Digital Power Management solutions.”
In addition to analog and power ICs, ROHM also supplies discrete semiconductors, passive components, sensors, and LEDs. Powervation joins several other companies acquired by ROHM including LAPIS Semiconductor Co., Ltd. (formerly OKI Semiconductor Co., Ltd.), SiCrystal AG, Kionix, Inc., and AGLED Co., Ltd. (formerly Maruzen Electric Co., LTD.).