Intel Corporation (NASDAQ:INTC) has again stuck its eyes on the programmable chips manufacturer Altera Corporation (NASDAQ:ALTR) to wrap up this rich asset. The deal would increase Intel’s existing product offerings.
This time Intel is offering $54 for each Altera share, almost $16 billion, giving 15 percent premium to Altera’s shares closing price on Thursday, based on the information provided by anonymous sources closed to the matter. If the deal go through then it would be largest deal in the history of Intel. Intel’s previous biggest deal was the procurement of McAfee, a security software company, worth $7.7 billion.
Intel is looking for merger deals in an environment where its Personal Computer business is continuously fading due to increased shifting of customers from PCs to smartphones. This thing pushes the semiconductor giant to think otherwise.
The latest move is a part of Intel Chief Executive Officer Brian Krzanich’s plans to expand into new markets, seeing its main business is dipping.
“It’s a good deal essentially because it sews up Intel’s data center supremacy even more,” Summit Research analyst Srini Sundararajan said.
Intel had been supplying chips to Altera Corp since 2013. This partnership was atypical, as traditionally Intel doesn’t share its advance technology to others.
In April Altera Corp rejected the $54 a share offer of Intel. The deal was abandoned by Altera Corp due to pricing issues.
“I think Altera was essentially trying to exploit the fact that Intel really needed them,” Sundararajan said.
Recently Avago Technologies Ltd acquired Broadcom Corp for $37 billion, making the largest merger in Tech history. In March NXP semiconductors announced the procurement of Freescale semiconductor company worth $17 billion.
These deals also push the semiconductor giant to look for further consolidation in this industry. Let’s see will Intel be able to procure Altera Corp. If Intel would be able acquire Altera Corp then it would be the third biggest deal in the semiconductor industry in the current year.
The deal may complete in the coming days, according to people familiar with the mater asking not be identified as the discussions held private, further cautioning that the deal between Intel and Altera wasn’t sure and may be once again scrapped.
