Intel Corp. is to purchase Infineon Technologies AG's Wireless Solutions Business (WLS) for $1.4 billion in cash with the deal expected to close in the first quarter of 2011.
This is yet another deal in a buying spree that has seen Intel agreed to acquire Texas Instruments Inc.'s cable modem product line, on Aug 16 and willing to spend $7.68 billion on security software vendor McAfee Inc. last week.
The technology that comes as part of the deal will be used in Intel Core processor-based laptops and Intel Atom processor-based devices, including smartphones, netbooks, tablets and embedded computers.
Intel says it is committed to serving WLS' existing customers, including support for ARM-based platforms and WLS will operate as a standalone business.
“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,” said Paul Otellini, Intel president and CEO.
Peter Bauer, CEO of Infineon Technologies AG., added that “The sale of WLS is a strategic decision to enhance Infineon's value. We can now fully concentrate our resources towards strong growth in our core segments automotive, industrial and multimarket, and chip card & security.
WLS provides baseband processors, radio-frequency transceivers, power management integrated circuits, additional connectivity features, single-chip solutions as well as the corresponding system software.
With annual revenue of Euro 917 million, WLS was approximately 30 percent of Infineon's total annual revenue of Euro 3.03 billion in the past financial year.
The deal has been much predicted with Infineon confirming that it was in discussions with several parties at the beginning of August days after CitiGroup said that Intel and Samsung Electronics Co., may compete to acquire the business.