Intel will buy Infineon wireless for $1.4 billion

Intel will buy German chipmaker Infineon’s wireless unit for $1.4 billion, enabling the U.S. chipmaker to boost its presence in the smartphone market The transaction should close in the first quarter of 2011. The mobile unit will remain as a standalone business.

This is the second major deal for Intel within two weeks after the company announced its $7.7 billion offer for McAfee Inc on Aug 19, its largest acquisition, bolstering the appeal of its chips as it tries to expand further into the mobile market.

Intel’s Atom mobile chips took the low-cost, no-frills netbook market by storm but are rarely found in smartphones where other chipmakers dominate.

“Infineon would make Intel an instant heavyweight (in the mobile space) and buy them three, four years in R&D,” IDC analyst Flint Pulskamp has said.

Analysts caution that while an acquisition such as Infineon’s mobile chip unit is a step in the right direction it will take time to produce results.

Rivals based on UK-listed ARM’s chip design continue to grab market share.

Infineon shares fell 1.4 percent to 4.54 euros in Frankfurt, widening losses they posted on Friday after Intel warned its third-quarter revenue would fall short of its own expectations due to weak consumer demand on personal computers.

Intel shares closed largely flat at Friday’s market close in New York at $18.37.

And, more good news: their logos look pretty similar, so no need to really change much.

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Posted on August 30, 2010, in Global Biz, Market Trends, Stocks, Bonds, & Funds, Technology and tagged , , , , , , , , , . Bookmark the permalink. Leave a comment.

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