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Jimelectr
I say, good luck, Intel! We at Broadcom picked up a bunch of good talent when ...
Baolt
At last deal is covered. I wonder why fellows at inf. accepted this offer? We ...
Infineon's wireless unit goes to Intel
Colin Holland
8/30/2010 3:09 AM EDT
Intel Corp. is to purchase Infineon Technologies AG's Wireless Solutions Business (WLS) for $1.4 billion in cash with the deal expected to close in the first quarter of 2011.
This is yet another deal in a buying spree that has seen Intel agreed to acquire Texas Instruments Inc.'s cable modem product line, on Aug 16 and willing to spend $7.68 billion on security software vendor McAfee Inc. last week.
The technology that comes as part of the deal will be used in Intel Core processor-based laptops and Intel Atom processor-based devices, including smartphones, netbooks, tablets and embedded computers.
Intel says it is committed to serving WLS' existing customers, including support for ARM-based platforms and WLS will operate as a standalone business.
"The acquisition of Infineon's WLS business strengthens the second pillar of our computing strategy – Internet connectivity – and enables us to offer a portfolio of products that covers the full range of wireless options from Wi-Fi and 3G to WiMAX and LTE," said Paul Otellini, Intel president and CEO.
Peter Bauer, CEO of Infineon Technologies AG., added that "The sale of WLS is a strategic decision to enhance Infineon's value. We can now fully concentrate our resources towards strong growth in our core segments automotive, industrial and multimarket, and chip card & security.
WLS provides baseband processors, radio-frequency transceivers, power management integrated circuits, additional connectivity features, single-chip solutions as well as the corresponding system software.
With annual revenue of Euro 917 million, WLS was approximately 30 percent of Infineon's total annual revenue of Euro 3.03 billion in the past financial year.
The deal has been much predicted with Infineon confirming that it was in discussions with several parties at the beginning of August days after CitiGroup said that Intel and Samsung Electronics Co., may compete to acquire the business.
This is yet another deal in a buying spree that has seen Intel agreed to acquire Texas Instruments Inc.'s cable modem product line, on Aug 16 and willing to spend $7.68 billion on security software vendor McAfee Inc. last week.
The technology that comes as part of the deal will be used in Intel Core processor-based laptops and Intel Atom processor-based devices, including smartphones, netbooks, tablets and embedded computers.
Intel says it is committed to serving WLS' existing customers, including support for ARM-based platforms and WLS will operate as a standalone business.
"The acquisition of Infineon's WLS business strengthens the second pillar of our computing strategy – Internet connectivity – and enables us to offer a portfolio of products that covers the full range of wireless options from Wi-Fi and 3G to WiMAX and LTE," said Paul Otellini, Intel president and CEO.
Peter Bauer, CEO of Infineon Technologies AG., added that "The sale of WLS is a strategic decision to enhance Infineon's value. We can now fully concentrate our resources towards strong growth in our core segments automotive, industrial and multimarket, and chip card & security.
WLS provides baseband processors, radio-frequency transceivers, power management integrated circuits, additional connectivity features, single-chip solutions as well as the corresponding system software.
With annual revenue of Euro 917 million, WLS was approximately 30 percent of Infineon's total annual revenue of Euro 3.03 billion in the past financial year.
The deal has been much predicted with Infineon confirming that it was in discussions with several parties at the beginning of August days after CitiGroup said that Intel and Samsung Electronics Co., may compete to acquire the business.
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Why8
8/30/2010 6:04 AM EDT
It's finally happened, after weeks of speculation.
It will be interesting to see how much of WLS will be integrated into Intel, particularly the central functions of the company, and the production locations.
Also interestingly, Intel is becoming a supplier to Apple once again for the iPhone business.
With this amount, Infineon should be able to repay its debt, and will be in a much better position to survive in the long term.
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Kiran_NSN
8/30/2010 6:18 AM EDT
OMG!!! Congratulations Intel. Finally I'm hearing some big news for you. This acquisition is like a golden duck. As we are all still discussing why Infinion want to sell this business unit which is contributing 30% to the net sales, the deal is over. Intel should be able to regain their top position in the semiconductor and keep samsung at bay. Finally Intel have something really strong to go into mobiles and into the 3G, LTE wireless modems. With their consecutive acquisition of cable modem business from Texas Instruments and this wireless solutions acquisition from Infinion, it looks like slowly Intel is going to move from computer company to a communications company!!!
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BalaLak
8/30/2010 6:37 AM EDT
Intel is surely not taking any chances with Samsung slated to overtake it & become the #1 semiconductor company this decade - there's a 50-50 chance that this may happen in 2014 according to this news article: http://eetimes.com/electronics-news/4206512/-Analyst--Samsung-on-pace-to-pass-Intel-as-No--1-IC-vendor. However, this is relatively new business for Intel and the marketplace is very different. They couldn't succeed in the Networking business, let's see how they deal with the wired/wireless communications space. Check out this really old (2003) column by the then CNET news editor (http://news.cnet.com/Intels-failure-to-communicate/2010-1006_3-5132994.html)
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Silicon_Smith
8/30/2010 9:55 AM EDT
Strategic moves! I am not sure, what Intel's long term plan is though. Anyhow, it was on the cards..
http://www.eetimes.com/electronics-news/4204779/Infineon--TI-are-tier-two-in-mobile-chips--says-analyst
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chanj
8/30/2010 12:10 PM EDT
Intel has been developing wireless technologies in the last couples of years. Finally, they made the move to acquire Infineton WLS, which is indeed a good news to the company. Will Intel successfully transit from PC giant to Communication giant? I love to hear your opinion.
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eewiz
8/30/2010 3:30 PM EDT
30% of total revenue and it is not considered core business!! I feel infineon should have kept the business for the same reasons Intel wanted it. ie. predicted explosive growth of internet connected devices.
From Intel's perspective, definitely this is a good move. Finally Intel has a good chance of getting at ARM, by integrating Moorestown Atom & 3g/4g connectivity from Infineon. Trying to repeat the Centrino's Success in MID space. But it wouldnt be as easy as ARM is already well integrated with various connectivity solutions.
@chanj I dont think Intel aim to be a communication giant. Infact the margins in commn chip market is much less than what Intel enjoys in the CPU market. Just that they want to make sure they will be able to sell their CPUs for MIDs.
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Baolt
8/30/2010 4:01 PM EDT
At last deal is covered. I wonder why fellows at inf. accepted this offer? We have an example of NXP-ST deal to creat JV where ST paid 1,55B$ just to %80 of NXP premature 3G, afterwards Ericsson acquired remaining to ~200M... Besides i wonder why samsung went behind, and letted intel to win the game? Perhaps they also didnt see so much value in it?
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Jimelectr
8/31/2010 12:31 AM EDT
I say, good luck, Intel! We at Broadcom picked up a bunch of good talent when Intel exited wireless last time in 2006. The culture shock was just too much to handle. And this time with TI's cable modem business and McAffee software? That's an awful lot to swallow.
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