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Intel-Infineon deal could come within weeks

updated 09:05 am EDT, Mon August 2, 2010

Intel leading bids to get Infineon for 2 billion

Intel's bid to buy Infineon's wireless business could be sealed within "days or weeks," insiders said this weekend [sub. required]. The chip designer has advanced far enough that it's the leading bidder even with competition from Broadcom and Samsung. While still uncertain, the WSJ tips assert that Intel has already performed due diligence on Infineon's finances to determine whether a deal would work.

The problem may depend on whether Intel is willing to match Infineon's target. It values the wireless component of its business at about $2 billion and may balk if Intel or another company isn't willing to bid as much or more. Some executives also reportedly still want to keep the business, especially as its revenue jumped 38 percent to $452.6 million in the spring.

None of the involved companies are willing to comment.

An acquisition would give Intel a significant jumpstart in the phone and tablet arenas, where it's only just now producing Atom processors small and effcient enough to enter the category. It may also give the company an unusual stake in those whose phones will compete against Atom-based models. Apple has used Infineon chips for the cellular baseband in the iPad and most iPhone models, although contrary to the report, it isn't using Infineon in the iPhone 4 based on current teardowns.

Broadcom and Qualcomm would face the biggest risk, as they both compete directly and would suddenly have to contend with a chipset maker that has Intel's scale.




by MacNN Staff

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