Akoustis Technologies, Inc. announced that it is acquiring a 51 percent majority ownership position of RFM Integrated Device, Inc. (RFMi), with the right to purchase the remaining 49 percent in 2022.
Akoustis will host an investor call to provide a business update and outlook, followed by a Q & A session. The conference call will be webcast live on the company’s website and will be available for playback. In terms of rationale for this opportunistic acquisition, RFMi offers Akoustis:
• A comprehensive SAW resonator & RF filter, crystal (Xtal) resonator & oscillator and ceramic catalog product portfolio which complements Akoustis XBAW™ RF products
• New, synergistic sales channels and numerous market-leading customers providing significant cross-selling opportunities for Akoustis XBAW™
• Access to new strategic markets including Automotive/ADAS, medical monitoring and implant, energy and smart home, satellite communications and industrial/IoT
• Access to new wafer-level-package (WLP) products that are currently manufactured in factories certified to stringent automotive IATF16949 standards
• The ability to develop multi-chip-modules incorporating multiple technologies for each of the end markets including 4G/5G mobile
• Access to complementary SAW resonator, Xtal resonator & oscillator products to enhance Akoustis’ XBAW™ RF timing product portfolio announced last week
• A low-capex, fabless product business with synergistic supply chain operations along with a proven technical, marketing and engineering team, and
• A bolt-on RF filter business which is immediately accretive to Akoustis financials from a cash flow perspective.
Jeff Shealy, founder and CEO of Akoustis, stated, “I am pleased to welcome the RFMi team to the Akoustis family, and look forward to adding several new end markets to our sales channel and broadening our XBAW™ funnel with significant cross-selling opportunities.” Mr. Shealy continued, “RFMi’s products complement our patented XBAW™ platform and make it possible to accelerate the development of multi-chip-modules that span 4G, 5G, Wi-Fi and satellite technologies for multiple markets.”
Akoustis intends to leverage its leadership in high-frequency BAW with RFMi’s growing portfolio of RF filter products to expand its reach into multiple markets and grow its portfolio of multi-chip-modules. Akoustis also intends to leverage RFMi’s WLP products which are currently made in factories certified to the IATF16949 automotive quality standard.
Additionally, RFMi’s timing control product portfolio will greatly expand Akoustis’ new timing and frequency reference capabilities, introduced last week, with a growing portfolio of crystal resonator and oscillator products and RF SAW resonators designed to operate at lower frequencies than Akoustis’ XBAW™ resonators.
RFMi also offers ceramic dielectric resonator filters and low temperature co-fired ceramic filters and diplexers for products that have significant power handling requirements, such as 5G network infrastructure, that exceed the capabilities of micro acoustic filter technology.
Financial Terms
Akoustis is paying $6.0 million in cash and approximately $2.5 million in stock to Tai-Saw Technologies Co., Ltd. (TST) for the acquisition of 51 percent of RFMi’s outstanding stock and has the option to acquire the remaining 49 percent from TST on or before June 30, 2022, for an additional $3.5 million in cash and approximately $4.0 million in stock. Additionally, earn-out payments aggregating up to $3.0 million of cash and/or stock may be payable to TST based on the future operating results of RFMi. The business is accretive, with positive cash flow, and is expected to contribute between $500k and $1 million in revenue in the December quarter.
Akoustis is actively delivering volume production of its Wi-Fi 6 tandem filter solutions to multiple customers, shipping multiple 5G small cell XBAWTM filter solutions, delivering initial designs of its new 5G mobile filter solutions to multiple tier-1 customers and is now entering the market with its new Wi-Fi 6E coexistence XBAWTM filter solutions.
Given the growing sales funnel activity as well as ongoing interaction with customers regarding expected ramps in both 5G mobile, Wi-Fi 6 and Wi-Fi 6E in calendar 2022, the company is increasing the annual production capacity at its New York fab, expected to reach a capacity of approximately 500 million filters per year by the end of calendar 2021.
Akoustis currently has 15 commercial XBAW™ filters in its product catalog, and recently introduced 5.6 GHz and 6.6 GHz Wi-Fi 6E coexistence filter modules, which when qualified, will bring the number of catalog products to 17. Current product catalog filters include a 5.6 GHz Wi-Fi filter, a 5.2 GHz Wi-Fi filter, a 5.5 GHz Wi-Fi-6E filter, a 6.5 GHz Wi-Fi 6E filter, three small cell 5G network infrastructure filters including two Band n77 filters and one Band n79 filter, a 3.8 GHz filter and five S-Band filters for defense phased-array radar applications, a 3.6 GHz filter for the CBRS 5G infrastructure market and a C-Band filter for the unmanned aircraft systems market. The company is also developing several new filters for the sub-7 GHz bands targeting 5G mobile device, network infrastructure, Wi-Fi CPE and defense markets.