Intel to acquire Altera for $16.7 billion

Intel has acquired chip company Altera for a total of 16.7 billion dollars, or 15.3 billion euros. Intel will use the technology of Altera, which is mainly known for FPGAs, to gain a firm foothold in the emerging Internet-of-Things market.

In addition to the Internet of Things, Intel is thinking of data centers as an area where Altera’s FPGAs can complement Intel’s own range of chips. The group specifically mentions custom-made integrated products with Xeon chips and FPGAs. Furthermore, Intel’s experience in preserving Moore’s Law, and thereby roughly reducing the size and making of chips, could have a positive influence on Altera’s products, the two companies believe.

Altera’s chips consist of programmable components and are therefore suitable for internet-of-things applications, among other things. Among other things, Altera uses ARM cores as building blocks for the FPGAs and Intel promises to continue to do so.

Rumors of takeover talks between Intel and Altera had been circulating for several weeks. It is Intel’s largest acquisition to date. In 2010, Intel acquired McAfee for $7.7 billion, the largest acquisition in its history to date. There have been many acquisitions in the semiconductor market lately. NXP recently acquired Freescale and Avago acquired Broadcom last week.

Intel expects to complete the acquisition in six to nine months.