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Chipmaker Atheros files for IPO

The maker of wireless networking chips is looking to raise $100 million through its initial public offering and intends to use part of the proceeds to pay back debt.

Wireless networking start-up Atheros Communications has filed for an initial public offering.

The Sunnyvale, Calif.-based company is looking to raise $100 million, according to a prospectus filed Nov. 26 with the Securities and Exchange Commission. The company intends to use net proceeds from the filing to repay about $4 million it borrowed from Silicon Valley Bank and the remainder for general corporate purposes, including working capital and capital expenditures.

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Company representatives were not immediately available for comment.

Details of the filing show that Atheros' revenue more than tripled from the beginning of the year to Sept. 30, compared with the same period a year ago, and while the company continues to lose money, those losses are decreasing.

Atheros was one of the first companies to deliver 802.11a chipsets, which have taken a backseat to 802.11b and 802.11g chips in terms of shipments to the retail market, the largest segment of the wireless networking industry. But the company has become a major supplier of 802.11b and 802.11g chips and is pushing to expand its position in the wireless networking industry, diversify its customer base, and extend into new markets such as consumer electronics. Atheros competes with Broadcom, Intel and Philips Semiconductor in the Wi-Fi chip business.

Atheros sells its chips to original design manufacturers (ODMs) and primarily receives revenue from them. ODM Global Sun Technology accounted for 28 percent of Atheros' net revenue during the nine months that ended Sept. 30, and Ambit Microsystems accounted for 19 percent. Sales to Asian customers accounted for 98 percent of net revenue and 91 percent for the year ended Dec. 31, 2002.

Atheros reported a revenue of $49.7 million for the first nine months of the year and a net loss of $12.9 million. For the same period a year ago, the company had revenue of $16.5 million and a net loss of $16.2 million.

Atheros' chips are found in PCs from Hewlett-Packard, IBM, NEC, Sony and Toshiba as well as Wi-Fi gear manufacturers D-Link, IO Data, Linksys, Microsoft, NetGear, Philips and Proxim.

Atheros has approximately 170 employees, according to the filing.