ORiNOCO: A Proxim Solution

As announced in June, for a price of $65 million in cash, Sunnyvale, CA-based Proxim Corporation has purchased the 802.11/Wireless LAN hardware equipment business of Agere Systems of Allentown, PA, including the entire ORiNOCO product line.

In a conference call, Proxim chairman and CEO Jonathan Zakin said that with Proxim’s 802.11a products plus ORiNOCO’s 802.11b market, “The combined company, we now believe, is the largest supplier of wireless LANs to the enterprise.”

In addition, Agere and Proxim are in a three-year agreement where the former will provide the latter with 802.11 chips, cards and modules; a licensing agreement that lets Proxim use Agere’s developed WLAN technology; and a the settlement of patent-related litigation that was brewing between the two. They will instead have a cross-license agreement on their patent portfolios.

The technology swap also brings new employees and locations to Proxim. Approximately 150 ORiNOCO personnel will transfer to Proxim, bringing that company’s total work force to around 550. Proxim gains facilities in Taiwan, the Netherlands, India, and two in the United States, Duluth, GA, and Herndon, VA.

“The acquisition of these assets gives us a number of major benefits including increased scale in not just manufacturing but also engineering resources, core technology and sales penetration,” says Zakin. “It improves our market presence, particularly internationally with 13 offices outside the US.”

Agere will retain its core business, providing processor chips to other businesses.

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