China-based Sequans Communications recently expanded its horizons by acquiring Swiss company Advanced Circuit Pursuit (ACP). This strategic move will enhance Sequans’ ambitions in the burgeoning reduced-capability 5G, or 5G RedCap, sector. ACP offers expertise in integrated circuits, radio frequency transceivers, and systems-on-chip for both IoT and 5G mobile broadband, underscoring its strategic value.
Sequans’ CEO, Georges Karam, emphasized this acquisition as a significant boost to their RedCap capabilities. Karam stated, “The 5G eRedCap market is expected to surpass 4G IoT in scale, and this acquisition strengthens Sequans’ ability to capture this expanding market opportunity.” ACP’s assets include a robust IP portfolio and a skilled team that will seamlessly integrate with Sequans’ operations, minimizing costs yet amplifying their technological prowess.
With this acquisition, Sequans aims to accelerate the time-to-market for new eRedCap IoT chips. The company foresees modest revenue growth in the short term, with potential for increased income in subsequent years, driven by ACP’s technology and existing client base. Key players within ACP acknowledge the pivotal nature of this merger in advancing their technological contributions to the wireless market.
As part of its strategic shift, Sequans sold its 4G/LTE portfolio to Qualcomm, while retaining a licence to continue developing it. This transition reflects a broader focus on 5G innovations, particularly in RedCap and eRedCap technologies. Qualcomm lauded the transaction for enhancing intelligence at the edge, positioning itself as a frontrunner in the evolving IoT space.
Interestingly, Sequans was on the verge of being acquired by Renesas Electronics last year. However, this $249 million deal fell through owing to unforeseen tax implications, compelling Sequans to seek alternate pathways for growth. The company emphasized its strong client relations and unique technological capabilities as factors in maintaining market momentum.