Broadcom’s Addition of SiByte Is Completed

Broadcom Corp. said it has completed its acquisition of Santa Clara chip-maker SiByte Inc. in a stock deal worth as much as $787.5 million, less than half of what the value was when the transaction was first announced.

The Irvine communications chip maker, whose aggressive acquisition strategy has made it the fastest growing company in its industry, acquired SiByte for as many as 7.47 million shares.

But since the agreement was announced Nov. 6, Broadcom’s stock tumbled from $219 a share to $105.44 Monday, the day the acquisition was completed. Initially, the transaction was valued at $2.04 billion. Broadcom’s stock retreated further Tuesday, falling $8.75 a share to $96.69 in Nasdaq trading.

Broadcom will record a fourth-quarter charge related to the acquisition. A First Call/Thomson Financial survey of 19 analysts projected the company will earn 31 cents a share in the fourth quarter, excluding extraordinary items.

Broadcom said the final purchase price is contingent on performance, which could entitle SiByte shareholders and option holders to receive as many as 3.75 million shares of Broadcom. These shares are included in the 7.47-million-share total.