Marvell has acquired Cavium – update

Chip company Marvell has reportedly taken over its smaller US industry peer Cavium. The acquisition of the network chips company would involve an amount of $ 6 billion, or 5.1 billion euros.

The two companies would announce the acquisition on Monday, writes The Wall Street Journal. Reuters sources also speak about the imminent announcement. Marvell would like to focus on a broader market after the acquisition.

As an ARM chip designer, Marvell is primarily active in the storage product market, but the company’s Armada socs have also made their way into consumer products such as the Chromecast. Marvell employs more than 5,000 people and last year had sales of $5.2 billion. The company also wants to target the growing market for chips in cars.

With an annual turnover of 600 million dollars in 2016 and with about eight hundred employees, Cavium is a lot smaller. This American company focuses with its ARM and MIPS chips on network equipment such as routers and switches. More companies are looking to scale up to improve their competitive position. Qualcomm, for example, is still awaiting approval from the EU to acquire NXP and Broadcom is in turn trying to acquire Qualcomm.

Update, Tuesday: The acquisition has been confirmed by Cavium and Marvell.