Technology heavyweight Intel has acquired Infineon's Wireless Solutions Business (WLS) for approximately $1.4 billion. The deal is expected to close in the first quarter of 2011.
The move is indicative of a stronger mobile play by the company, as WLS complements Intel's existing assets and will enable growth in mobile computing, smartphones and embedded computing, explains Intel.
The acquisition will contribute to Intel's networking plans, which include expanding the company's current Wi-Fi and 4G WiMAX offerings to include Infineon's 3G capabilities. The move also supports Intel's plans to accelerate LTE, explains the company.
World Wide Worx MD Arthur Goldstuck describes this acquisition as a natural one for the company. He argues that while Intel has been on an aggressive acquisition strategy, this latest move adds to the company's existing offerings rather than moving into unknown territory.
Goldstuck is of the view that the strong mobile play may be indicative of dwindling consumer PC purchases. “The acquisition certainly takes Intel's connectivity offerings into mobile in a big way.”
He predicts that the acquisition is unlikely to have a short-term impact. But in the long term, Intel's future laptops will come embedded with extensive connectivity capability.
According to Intel, the acquired technology will be used in Intel Core processor-based laptops, and myriad of Intel Atom processor-based devices, including smartphones, netbooks, tablets and embedded computers.
“The global demand for wireless solutions continues to grow at an extraordinary rate,” says Paul Otellini, Intel president and CEO.
“The acquisition of Infineon's WLS business strengthens the second pillar of our computing strategy - Internet connectivity - and enables us to offer a portfolio of products that covers the full range of wireless options from Wi-Fi and 3G to WiMAX and LTE.”
The board of directors of Intel and the supervisory board and the management board of Infineon have approved the transaction.
It is expected to close in the first quarter of 2011, subject to certain regulatory approvals and other customary closing conditions specified in the definitive agreement, notes the company.
Secure mobility
This latest deal comes just over a week after the company announced its $7.7 billion dollar acquisition of security technology company McAfee.
At the time Ren'ee James, senior VP of software and services at Intel, noted that security is important across Intel's existing businesses in the cloud and in terms of PCs.
“What we've been talking about is our growth businesses around mobile devices, embedded devices and consumer electronics. All of these billions of devices are going to be connected to the Internet and all of them are going to need security.”
She said hardware-enhanced security will lead to breakthroughs in countering the increasingly sophisticated threats that currently exist and that will exist in the future.
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