Silicon Integrated Systems (SiS) on June 12 announced on the Taiwan Stock Exchange (TSE) website that its new graphics spin-off Xabre Graphic Inc (XGI) has acquired the graphics chip unit of US-based Trident Microsystems to fortify its capability in notebook graphics technology. XGI, which is 99.99% owned by SiS, began operations on June 1. Capitalized at NT$450 million, XGI aims to develop business in the medium-range to high-end graphics chip market, according to SiS. XGI is planning to manufacture its graphics chips using the 0.13-micron process at SiS foundry partner United Microelectronics Corporation (UMC). The newly formed XGI will combine the operating assets and intellectual property of Trident's and XGI' graphics businesses. "By combining Trident's strength in the mobile graphics market with XGI' leading presence in the desktop market, XGI will merge the complementary strengths of both companies to effectively attack the graphics market. These combined strengths, together with a strategic alliance with SiS' core logic business and new capitalization from new investors should create a formidable power in both the mobile and desktop graphics markets," said Michael Chen, Chairman of the board of XGI and President and CEO of SiS. Other key highlights of the transaction include: Trident will initially own 30% of XGI when the transaction is completed. XGI's new management team will also consist of Trident's graphics management team. This transaction will close as soon as all the closing conditions are satisfied, expected to be prior to July 1, 2003. Sources: DigiTimes and Beyond3D