Apple Reportedly Snaps up Anobit, Will Build R&D Center in Haifa

An Israeli newspaper reports that Apple has agreed to acquire Israeli SSD controller specialist Anobit for between $400 million and $500 million and will open a development center in Haifa.
Posted December 20, 2011

Thor Olavsrud

Apple has reportedly acquired Israeli solid state drive (SSD) controller specialist Anobit for between $400 million and $500 million and also plans to open a research and development center in the country, which is known for its technological breakthroughs.

The report comes from Israeli Hebrew-language newspaper Calcalist, which said executives of Herzliya, Israel-based Anobit informed employees on Tuesday that the deal with Apple (NASDAQ:AAPL) had been completed. Calcalist first reported last week that Apple was negotiating with the founders of the privately held company: Prof. Ehud (Udi) Weinstein, Ariel Maislos and Ofir Levy.

Neither Apple nor Anobit have confirmed the deal, but this would not be the first time Apple has acquired a company without making an announcement. Earlier this year, Apple acquired C3 Technologies, a specialist in 3-D mapping technology, without an announcement.

The office of Israeli Prime Minister Benjamin Netanyahu was quick to welcome Apple. Netanyahu's office tweeted: "Welcome to Israel, Apple Inc. on your 1st acquisition here. I'm certain that you'll benefit from the fruit of the Israeli knowledge."

It is unclear whether the tweet was based on first-hand knowledge of the deal or in response to the report in Calcalist.

Anobit, founded in 2006, supplies mobile SSD controller technology used in smartphones and tablets—including Apple's iPhone and iPad, as well as its MacBook Air. It also supplies enterprise-class MLC-based SSDs.

Anobit's most notable technology centers on its signal processing capabilities. The company's Memory Signal Processing (MSP) technology leverages proprietary signal processing algorithms and advanced error correction (ECC). Anobit says the technology drives the endurance and performance of SLC-based SSDs using multi-level cell (MLC) NAND flash and next-generation triple-level cell (TLC) NAND flash.

In simple terms, Anobit's controller technology boosts the signal-to-noise ratio of SSDs, which is essential as SSD makers attempt to make denser, more compact flash memory because increased electrical interference causes the memory to become inherently error prone. Anobit's technology is able to make NAND flash much more stable and reliable.

"This deal makes strategic sense to us considering AAPL's philosophy of vertical integration (e.g., PA Semi acquisition, etc.) and current use of Anobit's technology," Brian Marshall, IT hardware and data networking analyst for International Strategy & Investment Group (ISG), wrote in a research note Tuesday morning. "We believe Anobit's key asset is their embedded consumer flash controller technology, called MSP, [which is] used in smartphones and tablets."

In 2008, Apple acquired fabless semiconductor specialist P.A. Semi to engineer custom chips for its tablets and smartphones. The deal for Anobit would be Apple's first hardware acquisition since that deal.

With a price tag of half a billion dollars, it could also be Apple's most expensive acquisition. In 1996, the company paid $429 million and 1.5 million shares of Apple stock for NeXT, the company Steve Jobs founded after his 1985 ouster from Apple. NeXT's OpenStep technology formed the foundation for much of the current Mac OS X system.

Parallel to the deal for Anobit, Apple is also reportedly preparing to open a development center—its first outside the US—in Haifa near the Technion – Israel Institute of Technology. The area already hosts development centers by tech giants Intel, Google, Microsoft and Yahoo!

Thor Olavsrud is a contributor to, the news service of the IT Business Edge Network, the network for technology professionals.

Tags: Apple, R&D

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