Wednesday, 28 June 2006

Marvell to Buy Intel’s Communications and Application Processor Business

Marvell Technology Group has announced that it would buy Intel’s communications and application processor business for USD 600 million plus the assumption by Marvell of certain liabilities.

The planned sale will give Marvell a strong presence in the growing market segment for processors used in smart handheld devices. The sale also will enable Intel to focus its investments on its core businesses, including high-performance, low-power Intel Architecture-based processors and emerging technologies for mobile computing, including Wi-Fi and WiMAX broadband wireless technologies.

The transaction is expected to close in about four to five months and is subject to regulatory review and other normal closing conditions.

Intel’s communications and application processor business develops and sells processors for handheld devices including smart phones and personal digital assistants.

Intel currently intends to receive the entire purchase price in cash. However, Intel has the option to take up to USD 100 million of the USD 600 million purchase price in Marvell common stock.

Upon closing, Marvell may record a one-time charge for purchased in-process research and development expenses.