LSI Logic
| Company type | Public |
|---|---|
| Industry | Semiconductor |
| Founded | November 1980 |
| Founder | Wilfred J. Corrigan, Bill O'Meara, Rob Walker, Mitchell "Mick" Bohn |
| Defunct | May 6, 2014 |
| Fate | Acquired by Avago Technologies (now Broadcom Inc.) |
| Successor | LSI Corporation |
| Headquarters | San Jose , United States |
Area served | Worldwide |
Key people | Wilfred J. Corrigan (founder, former CEO), Abhi Talwalkar (president and CEO from 2005) |
| Products | Semiconductor devices and software for storage, networking, mobile communication networks, client computing platforms |
Number of employees | 5,080 (2012) |
LSI Logic Corporation was a prominent American semiconductor firm headquartered in Santa Clara, California, recognized as a trailblazer in the ASIC and EDA sectors. The company concentrated on developing semiconductor devices and software solutions aimed at boosting storage and networking capabilities across data centers, mobile communication networks, and client computing platforms.
In April 2007, LSI Logic combined with Agere Systems and adopted the new name LSI Corporation. Later, on May 6, 2014, Avago Technologies (currently Broadcom Inc.) acquired the company for $6.6 billion.
At its height, LSI generated revenues of $2.51 billion in 2012 and employed approximately 5,080 staff members. Its main office was situated in San Jose, California. The firm’s strategic focus leveraged its ASIC design expertise to provide products and services that enhanced performance in storage and networking sectors, which was key to maintaining its market position prior to acquisition.
1981–2004
Founded in November 1980 by Wilfred J. Corrigan, LSI Logic Corporation commenced operations early the following year in Santa Clara, California. The acronym "LSI" stood for Large Scale Integration. Corrigan brought on board co-founders Bill O'Meara (Vice President of Marketing and Sales), Rob Walker (Vice President of Engineering), and Mitchell "Mick" Bohn (Chief Financial Officer). Initial capital of $6 million was secured from venture capital firms such as Kleiner Perkins Caufield & Byers and Institutional Venture Partners, followed by a $16 million funding round led by Sequoia Capital in 1982.
The company’s original business approach centered on CMOS gate arrays fabricated from masterslices, with metallization processes customized internally. To speed up market entry, LSI licensed designs from California Devices Inc. and reverse-engineered Motorola’s ECL gate arrays. A distinctive feature was their early interactive CAD tool, the LSI Design System (LDS), which was distributed directly to customers rather than kept proprietary—an uncommon practice that provided a competitive edge at the time.
LSI Logic went public on NASDAQ on May 13, 1983, issuing 7 million shares priced at $21 each, raising $147 million and valuing the company at $588 million. Its stock ticker was LLSI. Following this, LSI expanded internationally by establishing subsidiaries in Japan (Nihon LSI Logic Corporation in 1984), the United Kingdom (LSI Logic Ltd in 1984), and Canada (LSI Logic Corporation of Canada, Inc. in 1985). A joint venture with Kawasaki Steel in 1985 resulted in a $100 million wafer fabrication plant located in Tsukuba, Japan.
As one of SEMATECH’s founding members in 1987, LSI sought collaborative industry efforts but exited the consortium in 1992 due to unmet expectations. The company also entered strategic licensing agreements including manufacturing MIPS R2000 and R3000 chipsets under license from MIPS Computer Systems (1987) and producing SUN Microsystems’ SPARC RISC microprocessors (1988).
In October 1988, LSI acquired a majority interest in Video Seven Inc., a manufacturer of PC graphics boards. The following year, it merged its G-2 Inc PC chipset operation with Video Seven to form Headland Technology Inc., led by co-founder Bill O'Meara. Also in 1989, LSI transitioned its stock listing from NASDAQ to the New York Stock Exchange under the ticker symbol LSI.
During the early 1990s, LSI broadened its product offerings through collaborations and innovation: forming a joint venture with Sanyo Electric to develop HDTV chipsets (1991) and introducing CoreWare subsystems integrated into its ASIC design flow (1992). Notably, Sony Computer Entertainment chose LSI as its ASIC partner to integrate the PlayStation CPU onto a single chip (1993), utilizing LSI’s CoreWare intellectual property platform.
Throughout the mid- to late-1990s period, LSI pursued acquisitions to expand technological capabilities and market share: acquiring full ownership of its Canadian subsidiary (1995), Mint Technology engineering services (1997), Symbios Logic from Hyundai Electronic for $760 million cash (1998), and Seeq Technology for $106 million in stock to incorporate Ethernet physical-layer technology (1999).
In January 2000, LSI launched a $50 million venture capital fund aimed at communication startups as part of its growth strategy. That year also included acquisitions of IntraServer for $70 million to extend customer reach and Syntax Systems (2000), which was integrated into LSI Logic Storage Systems and later became Engenio Information Technologies.
The expansion continued with the purchase of video compression specialist C-Cube Microsystems for $878 million in stock (2001) along with acquiring American Megatrends’ RAID adapter division for $221 million cash—this included MegaRAID software intellectual property and key personnel.
Strategic partnerships included a distribution agreement with Storage Technology Corporation for co-branded storage products (2002) as well as acquiring Mylex from IBM to strengthen storage technology offerings. In November 2003, LSI divested its Tsukuba wafer fabrication facility selling it to ROHM Company for $23.5 million.
Engenio filed for an initial public offering in 2004 but retracted due to unfavorable market conditions following the dot-com bubble collapse.
2005 to 2014
In May 2005, Abhi Talwalkar, who previously held an executive position at Intel, was appointed president and CEO of LSI Logic and joined its board of directors. Wilfred Corrigan, the company's founder and long-serving CEO, continued as Chairman until May 2006.
During April 2006, LSI divested its design and manufacturing facility located in Gresham, Oregon, selling it to ON Semiconductor for $105 million. Later that year, in October, LSI agreed to merge with Agere Systems through an all-stock transaction valued at approximately $4 billion.
LSI pursued growth through acquisitions including SiliconStor Inc. for $55 million in March 2007, Tarari for $85 million in October 2007, and ONStor, a network-attached storage provider, for $25 million in July 2009. The merger with Agere Systems was finalized in April 2007, after which the company adopted the name LSI Corporation.
To concentrate on its primary business areas, LSI divested several units: the consumer products segment was sold to Magnum Semiconductor in July 2007; semiconductor assembly and test operations in Pathumthani, Thailand were transferred to STATS ChipPAC for $100 million in August 2007; and the Mobility Division was sold to Infineon Technologies for €330 million in October 2007.
In April 2009, LSI acquired the 3ware RAID adapter division from Applied Micro Circuits Corporation. Subsequently, in March 2011, the company sold its Engenio external storage systems unit to NetApp for $480 million. Engenio had reported revenues of $705 million in 2010.
January 2012 saw LSI expand into flash memory controllers by acquiring SandForce for $370 million. That same year, LSI introduced the Nytro product line—PCIe cards designed for data center servers that incorporated SandForce technology—focusing on application acceleration solutions.
In December 2012, LSI moved its stock listing from the New York Stock Exchange to the NASDAQ Global Select Market.
On December 16, 2013, Avago Technologies announced it would acquire LSI Corporation in a cash deal valued at $6.6 billion. This acquisition was completed on May 6, 2014, representing a major transformation in LSI’s corporate profile and market positioning.