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Intel in talks to acquire Via Telecom

Intel Corp. reportedly plans to acquire Via Telecom, a designer of system-on-chips and baseband processors for mobile devices. The deal would add several new telecommunications products into Intel’s portfolio, which will strengthen its positions on the market of low-end smartphones eventually.

Intel and Via Technologies are in the final stages of negotiations to buy Via Telecom for $500 million, according to Taipei, Taiwa-based Next Magazine, reports Bloomberg news-agency. Via Technologies owns half of the chip business and would get $250 million in cash if the takeover agreement is reached.

Via Telecom’s product portfolio includes one a low-end quad-core ARM Cortex-A7-based system-on-chip with CDMA, EVDA, GSM/GPRS/EDGE communication capabilities as well as baseband processors and modems. All of the products are designed for entry-level devices and could compliment Intel’s own portfolio of telco chips. Affordable telecommunication solutions as well as patent portfolio will help Intel to create more competitive mobile SoCs for developing markets, such as China.

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Last year Intel paid $1.5 billion for 20 per cent stake in Tsinghua Unigroup, which owns Spreadtrum Communications and RDA Microelectronics, two leading developers of application processors for mobile devices in China. Getting another chip designer would fit into Intel’s strategy.

Via Telecom has operations in China, South Korea, Taiwan and the U.S.

Intel, Via Technologies and Via Telecom did not comment on the news-story.

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KitGuru Says: While it makes some sense to acquire a telecommunication company for Intel, it hardly makes sense to pay $500 million for a relatively small chip designer. Perhaps, one of the things that Intel is interested in is Via Telecom’s experience in developing of ultra-low-cost SoCs for low-end smartphones. By taking over the company, Intel ensures that such handsets never end up with ARM processors inside.

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