Intel bids for Infineon’s wireless business

Intel has announced its second major acquisition in as many weeks, unveiling a $1.4 billion (€1.1 billion) takeover of Infineon’s wireless business.
 
The acquisition, announced this morning, allows Intel to expand beyond its current WiFi and Wimax technologies by incorporating Infineon’s 2G and 3G technologies into its core processors, and paves the way for joint development of 4G.
 
Intel CEO Paul Otellini said the deal would open up new device markets, including smartphones, netbooks, tablets and embedded computers, and rounds out the connectivity technologies it can offer.
 
“As more devices compute and connect to the Internet, we are committed to positioning Intel to take advantage of the growth,” Otellini said.
 
Intel expects the deal to be completed 1Q11, and will run the Infineon unit as a separate business.
 
Infineon’s wireless division, which produces a wide-range of silicon and associated software, was the firm’s second largest business unit in terms of sales during 2Q10 – the firm’s fiscal 3Q10 – generating 29% of the firm’s €1.2 billion in revenues during the quarter.
 
 
Selling the business leaves Germany-headquartered Infineon clear to focus on core markets including automotive, industrial, and chip card and security markets, CEO Peter Bauer said.
 
The deal comes hot on the heels of Intel’s plan to purchase security software player McAfee for $7.68 billion, and is part of a trend of PC stalwarts diversifying core operations.
 
Dell and HP are currently fighting for control of data storage firm 3Par, while Oracle has also bought firms outside its traditional markets in the past 12 months.

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