NVIDIA acquires PortalPlayer for $357m
updated 11:15 am EST, Mon November 6, 2006
NVIDIA acquires PortalPlay
Chip maker NVIDIA today announced that it will acquire PortalPlayer, the pioneer of its system-on-chip (SoC) technology which powers many digital media players -- including some of Apple's iPod models -- for $357 million. A teardown of Apple's 4GB iPod nano in September revealed that Samsung won out over PortalPlayer to supply the main microprocessor in the small device, which followed rumors in late June that new versions of Apple's iPod nano might see delays of up to six months as a result of the supplier switch. Nearly a month later, PortalPlayer CEO Gary Johnson announced plans to resign by the end of the year to pursue pre-IPO opportunities.
NVIDIA will pay $13.50 in cash for each outstanding share of PortalPlayer common stock, representing a total purchase price of approximately $357 million, or about $161 million net of cash on PortalPlayer's balance sheet as of September 30th, 2006. The purchase price represents roughly a 19 percent premium to the 20-day average closing price of PortalPlayer through Friday, November 3rd, 2006. The acquisition has been approved by the Board of Directors of each company and is still subject to regulatory approvals as well as other customary closing conditions.
