Intel Corp. has agreed to buy fellow chipmaker Altera Corp. in an all-cash transaction worth around US$16.7 billion.
The world’s largest chip maker announced Monday that it will offer US$54 per share for Altera, a San Jose-based firm that makes programmable chips which are used, among other things, to speed up Web-searches, Reuters reported.
The acquisition price represents a 10.5 percent premium to Altera’s Friday closing price.
The integration of Altera’s chips with Intel’s will create a new class of products giving customers a significant improvement in performance, lower costs and a lot more flexibility, Intel’s Chief Financial Officer Stacy Smith told Reuters.
Intel looked at other targets, but Altera was the best bet to create value for the shareholders, Smith said.
The transaction is the third big one in the highly fragmented chip industry this year.
In the industry’s largest-ever deal, Avago Technologies agreed last week to buy Broadcom Corp. for US$37 billion.
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