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Intel nears deal to buy Altera

Friday, May 29, 2015 - 01:33

A deal is likely by the end of next week, says the New York Post. Analysts say Altera's weak outlook could push it to accept a deal this time. Fred Katayama reports.

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Another huge chip deal nearing the finish line: The New York Post reports Intel is close to buying Altera for roughly $15 billion. It says the deal could come together by the end of next week. The semiconductor giant would pay about $54 a share, a 15 percent premium over Thursday's closing price. But the programmable chip maker rejected Intel's bid for the same amount of $54 back in April. So what would make it accept the offer this time? Analysts point to Altera's weak outlook and pressure the company faced from shareholders who were upset it had snubbed Intel last time. Wedbush Securities analyst Betsy Van Hees likes what she hears, saying, "We see the potential deal as a considerable positive, diversifying Intel's business away from the secularly declining PC market and expanding its already impressive footprint in the rapidly growing datacenter market." Intel shares up in early trading; Altera leaping sharply.to a four-year high. The latest development comes just one day after the biggest chip deal ever: communications chip maker Avago Technologies scooping up its rival, Broadcom, for $37 billion. The industry is being reshaped by a string of mergers amid slowing growth: witness NXP's purchase of Freescale Semiconductor in March and Avago's acquisition of Emulex in February. Intel is free to launch a hostile bid for Altera after Monday. That's when their negotiating agreement expires.

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Intel nears deal to buy Altera

Friday, May 29, 2015 - 01:33