Tundra Semiconductor

Infobox_Company
company_name = Tundra Semiconductor Corp.
company_type = Public
tsx|TUN
foundation = Ottawa, Ontario (1983)
key_people = Adam Chowaniec Chairman Daniel Hoste CEO David Long CFO
location = Ottawa, Ontario
num_employees = 300 (Q3 2006)
industry = System Interconnect
products = RapidIO system interconnect, PCI/PCI-X/PCI Express Bridges, HyperTransport bridges,VME bridges, Host bridges for PowerPC, Power Controllers
homepage = [http://www.tundra.com/ www.tundra.com]

Tundra Semiconductor Corporation (tsx|TUN) supplies communications, computing and storage companies with system interconnect products, intellectual property and design services backed by customer service and technical support. Tundra’s products includes bridges and switches enabling industry standards: RapidIO, PCI, PCI-X, PCI Express, PowerPC, VME, HyperTransport, Interlaken and SPI-4.2. Tundra’s products include board design and layout, with specific focus on system level signal integrity. Tundra's design services division, "Silicon Logic Engineering", offers ASIC and FPGA design services, semiconductor intellectual property and product development consulting.

Tundra headquarters are located in Ottawa, Ontario, Canada. It has design centers in North America: Ottawa, Eau Claire, Wisconsin; South Portland, Maine and in Hyderabad, India. Tundra sales offices are located in Europe, and throughout North America and Asia Pacific. Tundra has established a worldwide sales and customer support network offering direct sales and distribution through representatives and regional distributors.

=Tundra Semiconductor=

In September 2003 Tundra bought the MPC1xx family northbridge controllers for PowerPC G3 and PowerPC G4 systems from Motorola, and they have kept on developing them since now under the name Tsi1xx.

In 2004, Tundra joined with IBM and others to form Power.org, an organization devoted to drive development and adaptation of Power Architecture technology.

=History of Tundra=Though Tundra was incorporated as an entity in 1995 its history goes back to 1983 as Calmos Semiconductor, which was subsequently acquired in 1989 by Newbridge Networks Corporation, where it became known as Newbridge Microsystems and in 1995 was spun out as Tundra Semiconductor.

Calmos

Former MicroSystems International and Mosaid employee John Roberts founded Calmos ["Tech refugees' hatch a multimillion-dollar baby", The Ottawa Citizen, August 5, 2005 Page: E1] in April 1983. The company was initially run out of his home in Kanata and moved to a facility on Edgewater Road in Kanata once the company had raised funding of $800,000.

The company originally planned to design and produce gate array integrated circuits, or chips, to Canadian and U.S. customers. Unfortunately early on design work of this sort dried up and forced the company to focus on developing application-specific circuits. These application-specific circuits would later be incorporated into a larger circuits for other applications. It ended up being a profitable niche that saw the company through the early 1980’s memory market slump.

By October 1985, Calmos had raised additional funds bringing the total to $1.4 Million, had grown to 15 employees and had yearly revenue of $1.5 Million. In order to increase sales and grow the business John Roberts looked for a CEO with experience in the U.S. Semiconductor market. He found this in the person of Adam Chowaniec who had left Commodore International's Semiconductor division. Adam Chowaniec became President while John Roberts became Executive VP of R&D. [ "Calmos head steps aside for imported replacement", The Ottawa Citizen, October 10, 1985, Page: E13]

In February 1988 the company acquired the integrated circuit division of Siltronics for $500,000. The purchase brought with it revenue of $2 to $3 million and all of the inventory, machinery, customer lists and unfilled orders for Siltronics's bipolar integrated circuit product line. Calmos also hired 24 of the existing Siltonics staff including founder and vice-president Gyles Panther, doubling the size of Calmos's workforce. ["Calmos takes over profitable product line from defunct Siltronics", The Ottawa Citizen, February 9, 1988. Page: B1] Later that year Federal Industry Minister Michel Cote announced that Calmos had won a $3.07 million Canadian Federal grant to work with European Silicon Structures of Bracknell, England for joint development of Applications Specific Integrated Circuits (ASIC.) [ "Calmos to hire 135 workers with $3-M research grant", The Ottawa Citizen, March 11, 1987. Page: C7] At about this time the company grew to include an assembly plant located in Nepean, on Stafford Road. ["Local high-technology companies", The Ottawa Citizen, March 7, 1989 ,Page: G12]

In March 1989 Calmos acquired UltraMac Conversions which designed and manufactured peripherals for Apple's Macintosh computers, which subsequently operated under the name Calmos Data, the group was headed by the former president Lincoln Henthorn. ["Calmos buys UltraMac", The Ottawa Citizen, March 14, 1989, Pg. C3] By May Calmos Microsystems had grown to 55 employees, was profitable and had sales of over $4.5 million. Newbridge Networks, a Calmos customer and founded by Welsh entrepreneur Terry Matthews, who had also attended university with founder John Roberts, acquired the company. Newbridge was private at the time and subsequently went public that June, financial terms were not disclosed at the time. ["Newbridge buys Calmos", The Ottawa Citizen, May 27, 1989. Page: F7] However, in a 1997 Ottawa Citizen interview John Roberts stated that Calmos was purchased for $5 million in Newbridge Pre-IPO shares that subsequently became worth "about $100 Million." [ "Creating companies `acts of madness': New company just the latest high-tech achievement for John Roberts", The Ottawa Citizen, October 7, 1997 Page: E38]

Newbridge Microsystems

Newbridge Networks primarily acquired Calmos Microsystems for its single chip high-speed public key data encryption system, which became a selling point for Newbridge Networks systems to the U.S. federal government. The rest of the original Calmos Product line though revenue generating and profitable was not a major reason for the acquisition, these products continued to be sources of revenue well after the division was spun out as Tundra, most notably this include the 8085 variant which was sold as late as 1999. [ [http://www.tundra.com/products.aspx?id=1346 Tundra Products ] ]

In early 1990, Newbridge Microsystems licenced DY4 VME Interface Chip Set. This became the beginning of the companies involvement in system interconnect development that Tundra was later to become a leader in. At about this time Calmos Founder John Roberts left the company to become C.E.O. of the Strategic Microelectronics Consortium ["BUSINESS IN BRIEF", The Ottawa Citizen, February 10, 1990, Page: E1] and later founded another startup SiGe Semiconductor. ["Creating companies `acts of madness': New company just the latest high-tech achievement for John Roberts", The Ottawa Citizen, October 7, 1997 Page: E38]

In 1994 Newbridge Microsystems also developed the SPRITE T1, the first T1 Wide Area Network access card for a Sun Microsystems Computer Co. Netra Internet Server. SPRITE T1 was an SBus card that enabled full T1 WAN service directly in to a Sun Netra Internet Server. [The Ottawa Citizen, December 14, 1994, Page: F3] By early 1995 Newbridge Microsystems had announced a strategic relationship with Motorola Inc. for the development of a PCI to 68K bridge product family. [ "BRIEFLY", The Ottawa Citizen, January 13, 1995, Page: F6] This was to be the beginning of a long partnership between Newbridge Microsystems (Tundra) and Motorola which continues today with Tundra’s PowerPC system products.

In December 1995, Newbridge Networks decided that since the majority of their Microsystems divisions sales were for activities not related to the parent they would spin the company out and maintain a large financial interest. Thus Newbridge Microsystems assets were sold into a new Corporate entity known as Tundra Semiconductor. It is from this date that Tundra states that they were founded [ [http://www.tundra.com/corporate.aspx?bid=820&id=430 About Tundra ] ] and the management team that was in place later defined themselves as 'founders' of the new entity.

Tundra Semiconductor: Newbridge Affiliate

At the time of the Tundra spin out the company raised $10 Million (CDN) [ A built-in market: Kanata-based Tundra finds a semiconductor niche,The Ottawa Citizen, October 21, 1996, Page: A10] in third-party investment from Venture Capital Funds and Mutual funds, [MUTUAL FUNDS: Local fund shines in dismal June for investors, The Ottawa Citizen, July 16, 1996,Page: C3] Terry Matthews also made a personal investment and Newbridge retained a 38% ownership in the new entity [ A built-in market: Kanata-based Tundra finds a semiconductor niche,The Ottawa Citizen, October 21, 1996, Page: A10] meaning Tundra Semiconductor became a member of the Newbridge affiliate program. [ [http://www.parl.gc.ca/35/Archives/committees352/indu/evidence/28_96-10-31/indu28_blk101.html Thursday, October 31, 1996- com: Industry (28) ] ]

A benefit of the spin out from direct Newbridge Networks ownership was that Tundra was now free to sell to Newbridge competitors. Newbridge founder Terry Matthews, who was also Tundra's chairman of the board, encouraged the departure. " "We're maximizing the company's position," he said at the time. "There's no doubt that by opening up and appealing to a worldwide market, it was justified." [ "Chip growth to top 17% in 1998", The Ottawa Citizen, December 15, 1997, Page: C1] The company held its first AGM on October 20 where Adam Chowaniac stated the company would probably go public in 12-18 months. [ A built-in market: Kanata-based Tundra finds a semiconductor niche,The Ottawa Citizen, October 21, 1996, Page: A10]

In 1997, Canadian Industry Minister John Manley announced that Tundra Semiconductor would receive a $400,000 loan for R&D use. [ Business, The Ottawa Citizen, April 15, 1997, Page: C3] Chowaniec stated to a Rideau Club luncheon that Tundra had $11 million in revenue in 1996 and expected to generate $20 million or $21 million in revenue achieve profitability in 1997 and hoped to increase sales revenues by another 50 per cent in 1998. He also made reference to the fact that the company was having difficulty in recruiting the talent it needed to move the company forward with about 20 positions for engineers that were unfilled. [ Firms resort to bonuses to grab scarce talent, The Ottawa Citizen, May 31, 1997, Page: H1] The company employee count during this period grew from 50 to 70. [Business acumen lends company vision: Tundra makes its presence felt in semiconductor industry, The Ottawa Citizen, October 8, 1997, Page: E17.]

Tundras hopes to go public in 1998 were dashed by the Asian financial crisis that also affected the stock markets. Tundra will wait "until spring, (when) markets settle", Adam Chowaniec was quoted saying at the companies AGM. [Tundra postpones decision to go public, The Ottawa Citizen, October 16, 1998, Page: E5] Although this complicated their future growth plans, Tundra continued to grow from its profits and through the continued support of its private investors. [Tundra postpones decision to go public, The Ottawa Citizen, October 16, 1998, Page: E5] Part of this continued growth was the opening of a Mountain View office for sales and customer support. [Business, The Ottawa Citizen, November 10, 1998 Page: E3]

Tundra's IPO was not delayed as long as feared. With the quick rebound of the stock markets in late 1998, Tundra Filed its Prospectus and announced intentions to raise $25 - $50 million. [Buoyant market looks right for Tundra to go public: Newbridge affiliate will use IPO to raise cash for research and development, Ottawa Citizen, December 12, 1998, Page: H1 / FRONT]

Tundra Semiconductor: IPO & Public Company

Tundra's IPO, even though it was delayed was described as having "excellent timing" by Duncan Stewart, manager of Toronto's Navigator Technology fund. "The markets look to be back on its feet, and we're seeing robust growth." he added. [Buoyant market looks right for Tundra to go public: Newbridge affiliate will use IPO to raise cash for research and development, Ottawa Citizen, December 12, 1998, Page: H1 / FRONT] Though the market valuation of $120 million was considered "high" [Buoyant market looks right for Tundra to go public: Newbridge affiliate will use IPO to raise cash for research and development, Ottawa Citizen, December 12, 1998, Page: H1 / FRONT] the IPO was a success. According to the prospectus, Tundra had just over $20 million in revenue in its fiscal year 1997 (fiscal) and a profit of $473,000. CEO Adam Chowaniec noted that Tundra "has been profitable for the last six quarters, with a "stable of about 450 customers", the company also had 95 employees. [Buoyant market looks right for Tundra to go public: Newbridge affiliate will use IPO to raise cash for research and development, Ottawa Citizen, December 12, 1998, Page: H1]

With the Christmas and New Years holiday the Share placement was delayed in to 1999. The company began trading on Monday, February 8 on the Toronto Stock Exchange. The Shares placement was at $9.25 but the shares were in such demand that they opened well above this price at $13.10 and closed their first day of trading at $13.24. "It's been a fantastic experience", Adam Chowaniec said at the time, "People are buying into the stability of the company, and the reception from the institutions is positive." [Strong price gives Tundra cause to celebrate IPO: Shares begin trading on TSE nearly four dollars above offering price, Ottawa Citizen, Tuesday, February 9, 1999,Page: B1] The IPO also allowed Newbridge Networks to sell a portion of its ownership, cutting it from 37% to 17%. By march the company announced that its stake had fallen to 10.3% [Newbridge trims stake in Tundra with sale to underwriter, Ottawa Citizen, March 13, 1999, Page: D10]

By September 1999 the companies had completed a secondary offering of one million shares for $15.6 million [Ottawa: Tundra sells off stock, The Ottawa Citizen, November 28, 2001 ,Page: D3] and the stock was trading at $17.25. [Tundra reports record earnings, The Ottawa Citizen, August 26, 1999, Page: F3] The company also announced plans to move into a mixed-retail and office space campus in the Kanata Centrum Area [Concept tried, tested and true: Urban planning blend has worked since 19th century, The Ottawa Citizen, December 20, 2000] which never came to fruition.

The buoyant technology market led Tundra to look large scale expansion. The company had an internal goal of becoming a billion dollar company in Revenues by 2008 at the time the company expected revenue growth to stay at 20 to 50% annually "for the next couple years", according to an interview with Adam Chowaniac. [ Tundra raises the bar: Chip-design company sets billion-dollar goal for 2008, The Ottawa Citizen, September 17, 1999,Page: D1 / FRONT] In February 2000 the company announced their Q3 results of The company achieved record revenues of $10.435 million and earnings of $1.222 million (eight cents a share) in the third fiscal quarter ended Jan. 30, compared with $7.311 million in revenue and $539,000 earnings (five cents a share) for the same 1999 period. The stock subsequently hit a new all time high of $51.75 on the news. [Investors pounce on Tundra, The Ottawa Citizen, February 25, 2000, Page: D3 ] CIBC analyst Todd Coupland had, at the time, a "strong buy" recommendation and a 12-month target of $110 on Tundra. "Tundra's Q3 results ... and its competitive position support an accelerating outlook for revenue and earnings." [What the smart money sees, The Ottawa Citizen, April 1, 2000, Page: D1 / FRONT ]

Tundra shares, buoyed by excellent third-quarter results in late February, hit an all-time intraday high of $78 on March 8, 2000. In late April the company was added to the TSE 300 Composite, the TSE 200, and the Standard and Poor/TSE Canadian SmallCap Indices. [ Success on the first pass: Tundra Semiconductor develops multi-port bus switch in record-setting time,The Ottawa Citizen, April 24, 2000, Page: B1] For the fiscal year ended April 30, 2000, revenue was $40.672 million, up 46 per cent from $27.809 million the year before. Earnings for the year were $4.614 million, or 31 cents per fully diluted share, a 111 per cent gain over the $2.184 million, or 19 cents per share. [ Tundra stretches record to 15 quarters of growth, The Ottawa Citizen, June 1, 2000, Page: D3]

At about this time R&D initiatives that had been in the pipeline from the IPO funding started to come online. Tundra announced the deployment of a multi-port bus switch called the PowerSpan, which the company claimed was the industry's first multi-port PowerPC-to-PCI Bus Switch. [ Success on the first pass: Tundra Semiconductor develops multi-port bus switch in record-setting time,The Ottawa Citizen, April 24, 2000, Page: B1] Whlie the bulk of sales came from existing VME and QSpan products, the PowerSpan and the TSI 920 (A voice signals to digital messages converter), were expected to start contributing significant revenue number in the next fiscal year. [ Tundra stretches record to 15 quarters of growth, The Ottawa Citizen, June 1, 2000, Page: D3]

Using its still high share price Tundra acquired a South Providence, Maine-based chip developer for $45 million (U.S.) 90 per cent in stock and the balance in cash. Quadic Systems Inc had a relationship with Tundra, from providing expertise in the design of Tundra's recently released PowerPro and upcoming Tsi920 semiconductors. Former Quadic president David Ferris became vice president of the South Portland operation which had at the time of acquisition 37 employees. [Tundra pays $45 million for U.S. chip developer, The Ottawa Citizen, September 1, 2000, Page: D1]

References

External links

[http://www.tundra.com/ Corporate website]