Freescale Semiconductor Buyout?

Alchemist253 writes "The New York Times is running an article about a possible leveraged buyout of speciality chipmaker Freescale Semiconductor. Freescale currently makes a variety of embedded processors, microcontrollers, and memory, but is probably best known to the Slashdot crowd as the Motorola spinoff that supplied Apple its PowerPC chips before the shift over to an Intel architecture. From the article, "A consortium of investment firms was near a deal late last night to acquire Freescale Semiconductor... for more than $16 billion, according to people briefed on the negotiations. The deal, if completed, would be the largest leveraged buyout ever in the technology sector, surpassing the $11.3 billion sale of SunGard Data Systems last year.""

Borrow Money to Buyout a Company

[eldavojohn]

What is a leveraged buyout?

From the Wikipedia entry on it [wikipedia.org]:

A leveraged buyout (or LBO, or highly-leveraged transaction (HLT), or "bootstrap" transaction) occurs when a financial sponsor gains control of a majority of a target company's equity through the use of borrowed money or debt.

So, they're essentially borrowing money to buy them out. What does this mean? Well, perhaps the people buying them out think they can pay that debt off quickly or they have a lot of money in the bank and qualified for the loan. Either way, it's interesting to me because I would have predicted this company to drop in value after Apple went x86 architecture. I'm sure they have other business and contracts, it's just interesting to see someone borrow money to buy them out. What do they know that we don't? Isn't Freescale's business going to drop dramatically?

Re:With Intel and AMD rolling out the DRM

[ooze]

I just hope this takeover won't hurt them in thier technology decisions. Because I want to see a Subnotebook with their MPC8641D their MRAM as a buffer and about 10-20GB Flash. Combined with an organic iode display or a high resolution monochrome titanium-oxide screen and a decent battery that would be the ultimate outdoor writing and coding machine. The only thing it won't be overly suited for is video and high end gaming, but still should be enough for most. A laptop with days of battery time ...

Re:TFP is WRONG

[TheRaven64]

The only reason that x86 is still around is, that it is the only architecture Microsoft ever got their operating systems working on decently.

Windows NT ran fine on PowerPC, Alpha, and (I believe) MIPS. The problem was the applications. Very few were ever ported to anything else, and most people wanted to run legacy DOS applications. If you had an Alpha, you could run x86 applications using DEC's FX32! to emulate it, but that somewhat defeated the point of using a fast chip.

Re:Borrow Money to Buyout a Company

[xlordtyrantx]

Freescale has contracts with numerous companies. [freescale.com]

* Motorola cell phones

* Sony electronics

* Whirlpool appliances

* Logitech keyboards and mice

* Lifefitness cardiovascular and strength training equipment

* Cisco routers

* Bose Acoustic Wave radios

* Trane heating and cooling equipment

* Mercedes, BMW, Ford, Hyundai and General Motors vehicles

Re:TFP is WRONG

[ooze]

I don't know whwther you have read this [arstechnica.com] review and benchmark comparison of the Old and the new PowerMac/MacPro.

See, on one side we have the 3 years old Dual Single-Core G5 with 2,5GHz. On the other side we have the newest Dual DualCore Xeon with 2,66GHz. That is 3 years advance in technology and manufactoring process (even a geberation generation difference, the G5 is 90nm and the Xeon is 65nm), double the cores cores and a neglectable 1% advantage in Clock. Yet the speed advanatge barely scratches 50% in it's best tests, most of the time the advantage is only between 20% and 30%. And for benovelence they haven't even mentioned Performance/Watt. For comparison, this is somewhat like comparing a dual Pentium to a single i486 and only barely beating it. So why is that? It's the architecture. Those are the things the average user can see when he looks carefully.
The other thing is all the quircs and limitations (to name only a few: real mode, A20 gate, no execute flage etc, awkward paging mechanism, crufted, "baroque" instruction set) that an engineer has to work around to get it to work. That isn't immediately noticable to the end user. But what the end user notices is more glitches and unpredictable problems which are the results of not so clean designs. I'm only guessing, but I sort of have the impression that the well documented, but unheard of before problems with instability and and random shutdowns etc. are a result design not being so clean and managable as before.