Broadcom to Acquire Zeevo, Inc., The Leading Provider of Bluetooth(R) Stereo Headset Chips

Acquisition Extends Broadcom's Bluetooth Market Leadership in Cell Phones, Software, and PCs into Bluetooth Headsets, the Second-Largest Bluetooth Segment

IRVINE, Calif. and SANTA CLARA, Calif., March 7 /PRNewswire-FirstCall/ -- Broadcom Corporation (NASDAQ: BRCM), a global leader in wired and wireless broadband communications semiconductors, today announced that it has signed a definitive agreement to acquire Zeevo, Inc., a privately-held, Santa Clara-based provider of semiconductor and software solutions for Bluetooth(R) wireless headset products. The acquisition of Zeevo significantly accelerates Broadcom's time to market and competitive position in the wireless headset market segment, which In-Stat/MDR estimates will grow to nearly 90 million units per year by 2008.

Broadcom has established itself as a leading supplier of Bluetooth hardware and software solutions, with its Blutonium(R) single-chip transceivers and its WIDCOMM(R) software, which is the most widely deployed software in the industry. Broadcom has already established a leadership position in both the mobile phone and PC segments, which today are considered the first and third largest segments of the Bluetooth market, respectively, according to In-Stat/MDR. With the acquisition of Zeevo, Broadcom is now aggressively targeting the number two market segment for wireless headsets as well.

Zeevo has introduced multiple generations of semiconductor and software solutions specifically optimized for the unique needs of wireless headsets, all of which are proven in the market and shipping in volume production. By combining Broadcom's existing strengths, customer relationships, presence in complementary markets, and proven Bluetooth solutions with Zeevo's technology and innovative solutions, Broadcom's customers will benefit from a stronger product portfolio, optimized total solutions, enhanced support and a more comprehensive roadmap.

"The acquisition of Zeevo speeds our entry into the huge market for Bluetooth headset devices with a dedicated solution that complements our targeted offering of Bluetooth products," said Robert A. Rango, Group Vice President of Broadcom's Mobile & Wireless Group. "Adding the Zeevo(R) solutions rounds out our portfolio as we aim for leadership in the top three segments of the growing Bluetooth market."

Broadcom is a leading supplier of semiconductor solutions for Bluetooth wireless applications and was first to market with a Bluetooth-qualified single-chip radio. The company's Blutonium line of products includes solutions for both GSM and CDMA mobile phones, notebook and desktop PCs, smartphones and PDAs, as well as application-specific chips for wireless mouse, keyboard and other applications. Broadcom's WIDCOMM Bluetooth software is the most popular, feature rich and field proven Bluetooth software in the industry.

"The acquisition of Zeevo by Broadcom opens up a whole new range of exciting products and market opportunities for our home-grown technology," said Jalil Shaikh, President and CEO of Zeevo. "We look forward to combining our strengths in Bluetooth audio with Broadcom's impressive technology portfolio and creating competitive and innovative solutions for our customers."

Zeevo's highly integrated silicon designs and total system solutions have been optimized for use in wireless headset applications and feature extensive advancements in silicon integration, RF design, acoustical tuning, echo cancellation and other techniques intended to deliver the clearest possible audio experience over a client Bluetooth device. Adding these products to Broadcom's portfolio enables an immediate market entry for Broadcom with the most competitive solution available in production today. In addition, the all-CMOS design of Zeevo's chips opens up opportunities for creative integrations, accelerated product roadmaps, and further enhancements in future generations.

"As a leader in the Bluetooth stereo headset market, we consider Zeevo's technology to be state of the art in the industry, which is why we selected them for our products," said Bob Wick, Senior Vice President and General Manager of Logitech Audio & Interactive Entertainment Business Unit.

Zeevo, Inc. is located in Santa Clara, California and has approximately 50 employees.

In connection with the acquisition, Broadcom will pay a total of $32.0 million -- approximately $29.4 million in cash consideration and $2.6 million in restricted stock units that entitle the holder to receive shares of Broadcom Class A common stock as the award vests -- in exchange for all outstanding shares of capital stock and other rights, and to satisfy certain outstanding obligations and transaction expenses, of Zeevo. A portion of the total consideration paid will be subject to escrow pursuant to the terms of the acquisition agreement. The merger transaction is expected to close during Broadcom's current fiscal quarter, which ends March 31. The boards of directors of both companies have approved the merger, which awaits approval by Zeevo's shareholders and other customary closing conditions. At closing, Broadcom may record a one-time charge for purchased in-process research and development expenses related to the acquisition. The amount of that charge, if any, has not yet been determined.

About Zeevo

Zeevo is a leading-edge semiconductor provider that designs and markets "system-on-a-chip" (SoC) wireless products for use in consumer electronics products ranging from cellular phones to MP3 players to personal computers to loudspeakers. Zeevo's products uniquely solve the problem of high quality audio over Bluetooth. The company pioneered the concept of "Sound Design for Bluetooth(R)," a quality, reliability and convenience benchmark for Bluetooth audio that includes high quality audio, interference-free co-existence with IEEE 802.11 wireless, dynamic mode switching for convergence applications, and fail-soft out-of-range behavior. Zeevo Bluetooth platforms integrate analog, digital and radio-frequency (RF) circuitry, as well as memory and a programmable ARM7 processor, on a single-chip built using highly cost-effective, standard CMOS technology.

About Broadcom

Broadcom Corporation is a global leader in wired and wireless broadband communications semiconductors. Our products enable the convergence of high-speed data, high definition video, voice and audio at home, in the office and on the go. Broadcom provides manufacturers of computing and networking equipment, digital entertainment and broadband access products, and mobile devices with the industry's broadest portfolio of state-of-the-art system-on-a-chip and software solutions. These solutions support our core mission: Connecting everything(R).

Broadcom is one of the world's largest fabless semiconductor companies, with annual revenue of more than $2 billion. The company is headquartered in Irvine, Calif., with offices and research facilities in North America, Asia and Europe. Broadcom may be contacted at 1-949-450-8700 or at

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995:

All statements included or incorporated by reference in this release, other than statements or characterizations of historical fact, are forward-looking statements. These forward-looking statements are based on our current expectations, estimates and projections about our industry, management's beliefs, and certain assumptions made by us, all of which are subject to change. Forward-looking statements can often be identified by words such as "anticipates," "expects," "intends," "plans," "predicts," "believes," "seeks," "estimates," "may," "will," "should," "would," "could," "potential," "continue," "ongoing," similar expressions, and variations or negatives of these words. These forward-looking statements are not guarantees of future results and are subject to risks, uncertainties and assumptions that could cause our actual results to differ materially and adversely from those expressed in any forward-looking statement. Important factors that may cause such a difference for Broadcom in connection with the acquisition of Zeevo include, but are not limited to, the risks inherent in acquisitions of technologies and businesses, including the timing and successful completion of technology and product development through volume production, integration issues, costs and unanticipated expenditures, changing relationships with customers, suppliers and strategic partners, potential contractual, intellectual property or employment issues, accounting treatment and charges, and the risk that anticipated benefits of the acquisition may not be realized; general economic and political conditions and specific conditions in the markets we address, including the volatility in the technology sector and semiconductor industry, trends in the broadband communications markets in various geographic regions, and possible disruption in commercial activities related to terrorist activity or armed conflict in the United States and other locations; the rate at which our present and future customers and end-users adopt Broadcom's and Zeevo's technologies and products in the markets for Bluetooth wireless applications; delays in the adoption and acceptance of industry standards in those markets; our ability to retain and hire key executives, technical personnel and other employees in the positions and numbers, with the experience and capabilities, and at the compensation levels needed to implement our business and product plans; our ability to scale our operations in response to changes in demand for our products and services; competitive pressures and other factors such as the qualification, availability and pricing of competing products and technologies and the resulting effects on sales and pricing of our products; the timing, rescheduling or cancellation of significant customer orders and our ability, as well as the ability of our customers, to manage inventory; the gain or loss of a key customer, design win or order; our ability to specify, develop or acquire, complete, introduce, market and transition to volume production new products and technologies in a timely manner; the timing of customer-industry qualification and certification of our products and the risks of non-qualification or non-certification; our ability to timely and accurately predict market requirements and evolving industry standards and to identify opportunities in new markets; the volume of our product sales and pricing concessions on volume sales; the effects of new and emerging technologies; changes in our product or customer mix; intellectual property disputes and customer indemnification claims and other types of litigation risk; the availability and pricing of third party semiconductor foundry and assembly capacity and raw materials; fluctuations in the manufacturing yields of our third party semiconductor foundries and other problems or delays in the fabrication, assembly, testing or delivery of our products; the risks of producing products with new suppliers and at new fabrication and assembly facilities; problems or delays that we may face in shifting our products to smaller geometry process technologies and in achieving higher levels of design integration; the quality of our products and any remediation costs; the effectiveness of our expense and product cost control and reduction efforts; the risks and uncertainties associated with our international operations, particularly in light of recent events; the effects of natural disasters, public health emergencies, international conflicts and other events beyond our control; the level of orders received that can be shipped in a fiscal quarter; and other factors.

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