Intel rumoured to acquire FPGA giant Altera

March 30, 2015 // 10:51 a.m.

Tags: #acquisition #financial #fpga #semiconductor

Companies: #altera #intel #xilinx

Intel is rumoured to be in talks to acquire field-programmable gate array (FPGA) giant Altera in a deal which could be worth upwards of $10 billion, one of its largest acquisitions ever.

Intel is the undisputed heavyweight champion of the x86 chip market, enjoying revenue and a market capitalisation far in excess of its closest rival AMD. The company has recently been sniffing around new markets, however, beginning with embedded and mobile markets dominated by Cambridge-based fabless rival ARM. It has made several small-scale acquisitions to help with this push, but rumours it is interested in Altera point to its biggest acquisition ever.

Altera, along with rival Xilinx, specialises in field-programmable gate arrays (FPGAs), chips which can be configured on-the-fly to a user's requirements. Such devices are frequently used as a proving ground for new technologies, allowing for new chip designs to be trialled without the expense of producing dedicated hardware that may or may not work; they also find common use in low-volume high-end hardware where custom or semi-custom chip designs are required but an application specific integrated circuit (ASIC) would prove too costly. They're also an area of the semiconductor market in which Intel is under-represented, something unnamed sources claim the company is looking to change.

According to a report from the Wall Street Journal published late last week, Intel is in 'advanced talks' to acquire Altera in a deal which is valued at upwards of $10 billion - and could be as high as 10 per cent of Intel's overall market capitalisation. For Intel, it would gain an FPGA subsidiary whose revenue is growing faster than its own; for Altera, a shift away from reliance on third-party fabs to having market-leading production facilities owned by a parent company.

Altera has already worked with Intel, using its fabrication facilities and agreeing a technology-sharing deal back in 2013 which saw Intel's three-dimensional tri-gate transistor technology used as a bedrock for Altera's future FPGA designs.

Neither Intel nor Altera have publicly commented on the rumoured deal, but if the rumour proves true an announcement is expected in the very near future confirming the details of the acquisition.
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