Agere Sniffing Around Trebia?

Sources say Agere is interested in buying IP storage chip startup, but Emulex is also bidding

August 29, 2003

2 Min Read
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Agere Systems Inc. (NYSE: AGR.A) has expressed interest in acquiring IP storage chip startup Trebia Networks Inc., which earlier this week ceased active operations and laid off most of its employees, according to a former Trebia staffer (see Trebia Croaks).

Agere, a chip company based in Allentown, Pa., sells a wide range of integrated circuits, including silicon for high-density storage systems -- and its executives have said that storage and SANs are one of its key growth areas. Meanwhile, host bus adapter vendor Emulex Corp. (NYSE: ELX) was also said to be interested in picking up Trebia's technology.

"Emulex wanted to get the IP [intellectual property], but Agere wanted the company in its entirety," says the ex-Trebian. "They are supposedly going to call back a few people once the acquisition is completed." The source says between four and eight employees may be rehired in conjunction with a sale.

Trebia CEO Ruediger Stroh has confirmed the startup is negotiating to complete an acquisition, but he would not provide any information beyond that. An Agere spokesman declined to comment.

But an industry source familiar with Trebia says that Agere's name was not raised in any discussions about potential buyers, while Emulex's was. "Unless it's a late entry or the two Germans there were purposely spreading disinformation, my guess is [the buyer will be] Emulex," says this source.The "two Germans" referred to are Stroh and VP of engineering Nik Bahram, who had previously worked with Stroh as VP of corporate ventures at wireless networking chip startup Systemonic AG. Stroh was CEO of that company, which was acquired in December 2002 by Philips Semiconductors (NYSE: PHG).

The ex-Trebia employee says the plan has been to try to sell the company ever since the VCs got rid of CEO Bob Conrad and much of his team in February. "Stroh is just a contractor," the source says. "He was brought on board to sell the company." (See Trebia Taps Stroh as CEO, Is Trebia Up for Sale?, Trebia Ousts CEO, and Trebia Gets Second Wind.)

Predictably, the former Trebia employee is bitter about the way things turned out: "There was a good group of people there, and they absolutely got treated like dirt."

Unfortunately, Trebia will surely not be the last startup that runs out of money and leaves its employees high and dry.

Todd Spangler, US Editor, Byte and Switch

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