WASHINGTON Dec 18 The U.S. Federal Trade
Commission on Tuesday said it would seek to block a proposed
$330 million purchase of PLX Technology Inc by
Integrated Device Technology Inc, saying the combined
firm would have a near-monopoly on certain computer components.
Both companies make integrated circuits called PCIe
switches, which perform critical connectivity functions in
computers and other widely used electronic devices.
"The combination of IDT and PLX would hurt competition and
lead to higher switch prices, lower innovation in the
marketplace, and reduced customer service," said Richard
Feinstein, director of the FTC's Bureau of Competition.
The combined firm would have a share exceeding 85 percent in
the global PCIe switch market, the commission said.
Headquartered in San Jose, California, IDT makes a range of
semiconductor components used in communications, computing, and
consumer applications. It proposed buying PLX, headquartered in
Sunnyvale, California, in April.
FTC said customers have traditionally used the competition
between IDT and PLX to play one company against the other and
achieve lower prices.
IDT closed at $6.92 per share, up 10 cents, on Nasdaq, and
PLX Technology closed at $4.50, down 7 cents.