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Mellanox Technologies

Mellanox Technologies Ltd.
Company typeSubsidiary
Nasdaq: MLNX
IndustryCommunication equipment
Founded1999; 25 years ago (1999) in Yokneam Illit, Israel
FoundersEyal Waldman, Shai Cohen, Roni Ashuri, Michael Kagan, Evelyn Landman, Shimon Rottenberg, Eitan Zahavi, Udi Katz, Alon Webman
Defunct2020 (2020)
FateAcquired by Nvidia
HeadquartersSunnyvale, California, U.S.[1]
ProductsEthernet and InfiniBand switches
host bus adapters
RevenueIncrease US$1,330.6 Million (FY19)[2]
Increase US$207.9 Million (FY19)
Increase US$205.1 Million (FY19)
Number of employees
2800 (March 2020)
ParentNvidia
Websitemellanox.com

Mellanox Technologies Ltd. (Hebrew: מלאנוקס טכנולוגיות בע"מ) was an Israeli-American multinational supplier of computer networking products based on InfiniBand and Ethernet technology. Mellanox offered adapters, switches, software, cables and silicon for markets including high-performance computing, data centers, cloud computing, computer data storage and financial services.[3]

On March 11, 2019, Nvidia announced its intent to acquire the company for $6.9 billion.[4][5] Other companies willing to acquire Mellanox were Intel, Xilinx and Microsoft.[6] The deal closed on April 27, 2020, with approval from the EU, U.S. and Chinese antitrust authorities.[7]

The company was integrated into Nvidia's networking division in 2020 and Nvidia stopped using the brand name "Mellanox" for its new networking products.

History

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1999–2009

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Mellanox was founded in May 1999 by former Israeli executives of Intel Corporation and Galileo Technology (which was acquired by Marvell Technology Group in October 2000 for $2.8 billion)[8] Eyal Waldman, Shai Cohen, Roni Ashuri, Michael Kagan, Evelyn Landman, Eitan Zahavi, Shimon Rottenberg, Udi Katz and Alon Webman. Eyal Waldman founded Mellanox in the Israel city of Yokne'am.[9] Financial offices were in Santa Clara, California in the USA.[10] In February, 2002, a round of venture capital investment was announced of about $56 million.[11] Later extended to about $64 million, investors included Intel, IBM, Sequoia Capital and U.S. Venture Partners,[10][12]

Mellanox had its initial public offering in February, 2007, on NASDAQ that raised $102 million, and valued the company at over half a billion dollars.[13] Its shares were listed under the symbol MLNX.[14] Created in 2009, Mellanox's investment fund was publicly announced in 2014.[15] Initially founded as an integrated circuit (chip) manufacturer, it evolved into a producer of complete network systems by 2009.[16]

2010–2016

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In 2010, Oracle Corporation became a major investor in the company, holding around 10% of its stock.[12] Oracle uses InfiniBand technology in its Exadata and Exalogic appliances.[17] Stock shares were also listed on the Tel Aviv Stock Exchange, until 2013 when the company de-listed itself, but remained on NASDAQ.

In February 2011, Mellanox acquired Voltaire Ltd., a provider of data center switches for about $218 million.[18][19] In November 2012, Mellanox was named one of the fastest growing companies by a marketing firm.[20]

In 2013 Mellanox acquired assets of XLoom Communications Ltd., including opto-electric chip-scale packaging, and some of XLoom's technology personnel.[21] In July 2013, Mellanox acquired privately held Kotura, Inc., a developer of silicon photonics optical interconnect technology for high-speed networking.[22] In July 2013, Mellanox acquired privately held IPtronics A/S, a designer of optical interconnect components for digital communications.[23]

In July 2014, Mellanox acquired privately held Integrity Project, for its software connectivity, low-level development, real-time applications and security technology.[24] In February 2016, Mellanox acquired publicly held EZchip Semiconductor, a provider of network processors and multi-core processors from EZchip's earlier acquisition of Tilera.[25]

In 2016, Mellanox Technologies began to employ programmers in the Gaza Strip, in addition to its team of Israeli Arab programmers and programmers in Ramallah and Nablus.[26] In 2016, Mellanox had revenues of $857 million.[9] In December 2017, Mellanox announced it would start a new startup accelerator.[15] Over 2017, shares in the company rose by 55 percent. That year, the company also made its largest acquisition with EZchip.[9]

2018–acquisition

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The activist investor Starboard Value LP purchased a 10.7% stake in the company in November 2017.[27] In January 2018, Starboard criticized the company's research and development spending and argued for short-term profits instead.[28][29] The day after, on January 9, 2018, Mellanox announced it would immediately discontinue its 1550 nm silicon photonics development activities, with president and CEO Eyal Waldman saying the review of the silicon photonics business had started in May 2017.[30] Mellanox also said it would fire 100 people, all in the US. At the time, the company employed 2,900 people, mostly in Israel.[31]

In a "board battle,"[32] Starboard sent a letter to shareholders asking them to entirely replace the board of directors.[33] At the time, Mellanox had a $3.3 billion market value.[27] Starboard said it would nominate nine candidates for election to the company's board, including Starboard head Jeffrey Smith.[34] In May, 2018, stockholders approved the company's governance proposals related to the possibility of the contested board elections.[35] By June, 2018, three board members agreed to step down and be replaced by two Starboard candidates and one agreed upon by both sides.[36]

In 2019, Mellanox was acquired for $6.9 billion by Nvidia Corporation making it one of the largest mergers and acquisitions in 2019.[37] Founder and long-term CEO Eyal Waldman left the company in November, 2020. He made an estimated $240 million on the acquisition.[38]

Products and market

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Mellanox at SC18

Mellanox was a fabless semiconductor company, which then sold products based on those semiconductor integrated circuits.[39] Starting from at least 2011, its chips were produced by Taiwan Semiconductor Manufacturing Corp (TSMC).[40] Mellanox Technologies provided Ethernet and InfiniBand network adapters, switches and cables for servers and storage used in cloud and enterprise data centers based on internally developed integrated circuits.[19][41] Mellanox had two major customers, Hewlett-Packard and Dell EMC, which each contributed more than 10% of revenues in 2017, 2018, and 2019.[3]

Mellanox specialized in switched fabrics for enterprise data centers and high performance computing, when high data rates and low latency are required such as in a computer cluster.[16] One typical application was a large database management system.[42] Mellanox network adapter and switches supported remote direct memory access (RDMA) and RDMA over Converged Ethernet.

Product names included:

High-performance computing

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By 2011, Mellanox's InfiniBand products for computer clusters had been deployed in many of the TOP500 lists of high-performance computers.[48]

Storage

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Although originally associated with InfiniBand products, Mellanox was later able to use its technology for storage area networks (SANs), to replace legacy Fibre Channel for example with the much more common Ethernet family of standards, since 2011.[49][40]

Operations

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In addition to its headquarters in the US, Mellanox had offices in Israel, Denmark, China, Russia, Singapore, Taiwan, Japan and the United Kingdom.[50]

Hiring practices

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Mellanox outsourced some of its engineering to the West Bank. Rather than setting up offshore engineering centers in the Far East or Eastern Europe, Mellanox hired Palestinian engineers from Ramallah through a Palestinian outsourcing firm.[51] In 2018, Waldman told a Tel Aviv conference hosted by Globes magazine that over 100 Palestinians are working on Mellanox projects.[52]

Waldman had previously talked about Mellanox's plans to build a research and development center in Ramallah, even though it is more expensive than outsourcing to Eastern Europe.[53]

See also

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References

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  1. ^ "Mellanox office locations". Mellanox Technologies.
  2. ^ "mellanox delivers record fourth quarter and annual 2019 financial results" (PDF). Mellanox Technologies. 2020.
  3. ^ a b "Form 10-K/A: Annual Report for the Year 2019". US Securities and Exchange Commission. April 23, 2020. Retrieved September 27, 2021.
  4. ^ "NVIDIA buys high-performance chip-maker Mellanox for $6.9 billion". Engadget. Retrieved 2021-06-08.
  5. ^ Newsroom, NVIDIA. "NVIDIA to Acquire Mellanox for $6.9 Billion". NVIDIA Newsroom Newsroom. Retrieved 2021-06-08. {{cite web}}: |last= has generic name (help)
  6. ^ "Daily Crunch: NVIDIA is buying Mellanox for $6.9B". TechCrunch. 11 March 2019. Retrieved 2019-03-12.
  7. ^ "Nvidia gets China's go-ahead for $6.9 billion Mellanox deal". Reuters. 2020-04-16. Retrieved 2021-06-08.
  8. ^ "Marvell to acquire LAN-chip supplier Galileo for $2.7 billion in stock". EE Times. 2000-10-17. Retrieved 2011-06-12.
  9. ^ a b c Solomon, Shoshanna (December 26, 2017). "When a startup gets big, the environment gets rougher, says Mellanox CEO". The Times of Israel. Retrieved January 20, 2018.
  10. ^ a b "Form D: Notice of Sale of Securities" (PDF). US Securities and Exchange Commission. March 20, 2002. Retrieved September 27, 2021.
  11. ^ Kovar, Joseph F. (February 11, 2002). "VC Money Continues To Drain Into InfiniBand: Mellanox Secures $56M". CRN Magazine. Retrieved September 27, 2021.
  12. ^ a b Tsipori, Tali (September 25, 2011). "Oracle acquires $11m more Mellanox shares". Globes. Retrieved 2011-10-29.
  13. ^ Walko, John (February 8, 2007). "Mellanox raises $102 million with IPO on Nasdaq". EE Times. Archived from the original on March 16, 2012. Retrieved September 27, 2021.
  14. ^ "Amendment Number 2 to Form S-1: Registration Statement". US Securities and Exchange Commission. December 7, 2006. Retrieved September 27, 2021.
  15. ^ a b Habib-Valdhorn, Shiri. "Mellanox to launch startup accelerator". Globes. Retrieved January 20, 2018.
  16. ^ a b Ackerman, Gwen (January 5, 2011). "Mellanox CEO Sees Sales Rising 10-Fold With Voltaire". Bloomberg. Retrieved 2011-10-29.
  17. ^ Bagh, Carl (October 29, 2010). "Oracle buys 10 pct stake in Mellanox, will Dell, HP, IBM follow suit?". International Business Times. Archived from the original on November 12, 2010. Retrieved 2011-10-29.
  18. ^ "Mellanox Technologies, Ltd. Completes Acquisition of Voltaire, Ltd". Press release. February 7, 2011. Retrieved April 23, 2017.
  19. ^ a b Timothy Prickett Morgan (November 29, 2010). "Mellanox gobbles up Voltaire for $218m". The Register. Retrieved April 23, 2017.
  20. ^ "Mellanox Technologies Ranked Number 364 Fastest Growing Company in North America on Deloitte's 2012 Technology Fast 500". Mellanox. Retrieved November 14, 2012.
  21. ^ "Strategic Acquisitions". Mellanox web site. Retrieved September 27, 2021.
  22. ^ "Mellanox Technologies, Ltd. Completes Acquisition of Kotura, Inc". NASDAQ. Retrieved Aug 15, 2013.
  23. ^ "Mellanox Technologies, Ltd. Completes Acquisition of IPtronics A/S". NASDAQ. Retrieved Jul 1, 2013.
  24. ^ "Mellanox Technologies Ltd. Announces Definitive Agreement to Acquire Integrity Project". NASDAQ. Retrieved June 24, 2014.
  25. ^ Cohen, Tova (2015-09-30). "Israel's Mellanox to buy EZchip for $811 million". Reuters. Retrieved 2021-06-08.
  26. ^ Mellanox Hires Programmers in the Gaza Strip
  27. ^ a b Benoit, David (January 17, 2018). "Starboard Value to Launch Proxy Fight for Entire Board at Mellanox". The Wall Street Journal. New York City, New York. Retrieved January 18, 2018.
  28. ^ Solomon, Shoshanna (January 8, 2018). "Activist investor Starboard calls for 'substantial change' at Israel's Mellanox". The Times of Israel. Retrieved January 20, 2018.
  29. ^ Venugopal, Aishwarya (January 8, 2018). "Starboard says chipmaker Mellanox's 2018 targets insufficient". Reuters. Retrieved January 20, 2018.
  30. ^ "Mellanox to cease 1550nm silicon photonics development". optics.org. January 10, 2018. Retrieved January 20, 2018.
  31. ^ Solomon, Shoshanna (January 10, 2018). "Mellanox to cut 100 US jobs as chip line development halted". The Times of Israel. Retrieved January 20, 2018.
  32. ^ Schacknow, Peter (January 18, 2018). "Stocks making the biggest moves premarket: MS, WMT, WWW, LQ, AAPL, AA & more". CNBC. Retrieved January 20, 2018.
  33. ^ Ray, Tiernan (January 18, 2018). "Mellanox, Under Siege From Starboard, Surges 6% on Q4 Beat, Outlook". Barron's. Retrieved January 20, 2018.
  34. ^ Starboard to nominate nine candidates to Mellanox board, Reuters, January 17, 2018, retrieved January 20, 2018
  35. ^ Dror Reich (May 27, 2018). "Mellanox Wins First Round in Struggle with Activist Shareholder Starboard". Calcalist Tech. Retrieved September 27, 2021.
  36. ^ Dror Reich (June 21, 2018). "Mellanox CEO Downplays Drama of Starboard's Attempt to Take Over Board". Calcalist Tech. Retrieved September 27, 2021.
  37. ^ GmbH, finanzen net. "Nvidia is buying Mellanox Technologies in a $6.9 billion deal (NVDA) | Markets Insider". markets.businessinsider.com. Retrieved 2019-10-05.
  38. ^ Omri Zerachovitz and Ofir Dor (November 4, 2020). "Waldman quits Mellanox: I don't want to be number two". Globes. Retrieved September 27, 2021.
  39. ^ "Web-chip fabless Mellanox poised to raise $50m at company value of $250m". TheMarker. October 30, 2001. Archived from the original on February 4, 2013. Retrieved 2011-10-29.
  40. ^ a b Prickett Morgan, Timothy (April 26, 2011). "Mellanox uncloaks SwitchX network switch-hitter". The Register. Retrieved September 27, 2021.
  41. ^ Amodio, Michelle (October 6, 2011). "On the Road with Mellanox Technologies". TMCnet. Retrieved September 27, 2021.
  42. ^ "Oracle Makes Strategic Investment In Mellanox Technologies, Ltd". Press release. Oracle. October 27, 2010. Archived from the original on November 6, 2010. Retrieved September 27, 2021.
  43. ^ "ConnectX-6 Product Family". Mellanox.
  44. ^ "ConnectX-6 VPI". community.mellanox.com. Retrieved 2016-06-22.
  45. ^ "ConnectX-6 Dx". www.mellanox.com. Retrieved 2020-01-07.
  46. ^ Sur, Sayantan; Koop, Matthew J.; Lei; Panda, Dhabaleswar K. (2007). "Performance Analysis and Evaluation of Mellanox ConnectX InfiniBand Architecture with Multi-Core Platforms". Hoti. 15th Annual IEEE Symposium on High-Performance Interconnects (HOTI 2007): 125–134. CiteSeerX 10.1.1.81.4890.
  47. ^ "NVIDIA Networking Linkx Cables and Transceivers at PNY.com". PNY.com. Retrieved 2024-01-31.
  48. ^ "Mellanox 200G HDR InfiniBand Accelerates 31% of New InfiniBand Systems on November's TOP500". Bloomberg. June 27, 2011.
  49. ^ Prickett Morgan, Timothy (September 26, 2017). "The Ascendancy Of Ethernet Storage Fabrics". The Next Platform. Retrieved September 27, 2021.
  50. ^ "Mellanox Contact Us". www.mellanox.com. Retrieved 2019-04-01.
  51. ^ Heruti-Sover, Tali (November 7, 2010). "High-tech company aims to be first Israeli firm to hire Palestinian engineers". Haaretz. Retrieved 2011-10-29.
  52. ^ Levy, Aviv (21 June 2018). "Mellanox CEO: We employ over 100 Palestinians". Globes. Retrieved 25 July 2018.
  53. ^ Mitnick, Joshua (April 22, 2011). "Tech diplomacy: Israeli CEO hires Palestinian programmers". The Christian Science Monitor. Retrieved 2011-10-29.
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