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Intel will possibly acquire NVIDIA

Reuters speculates Intel is set to acquire NVIDIA. The speculation arose when NVIDIA’s shares rose 8% to $30.62 on the NASDAQ. Approximately 20 million shares were traded according to Reuters. Intel representatives declined to comment while NVIDIA representatives were unavailable. Bill Lefkowitz, options strategist, vFinance Investments believes Intel will make the announcement tonight.

This is still speculation at the moment as NVIDIA was deemed too expensive to purchase.The article claims:

Some observers said that they doubt Intel would buy NVIDIA because it's too expensive. The company has a stock market capitalization of about $10 billion, which means it would demand a far higher price than what AMD is paying for ATI.

Nevertheless, if the acquisition were to happen it would be interesting to see what Intel has in store for NVIDIA, as Intel holds the majority of the graphics market.  Intel’s primary competitor, AMD, previously acquired ATI Technologies -- NVIDIA’s primary competitor. The proposed AMD and ATI merger is nearing its final stages at the moment.


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PFFFF
By Gigahertz19 on 10/4/2006 11:27:59 PM , Rating: 2
Nvidia is way to expensive for Intel to purchase for now at least, I'll eat my words though if this DailyTech rumor turns out to be true :)




RE: PFFFF
By jjunos on 10/4/2006 11:45:31 PM , Rating: 3
There isn't really anything that's "too expensive" for intel if you consider how much each company is actually worth.

On the other hand, how much intel is *willing* to pay is an entirely different thing.


RE: PFFFF
By SexyK on 10/4/2006 11:53:40 PM , Rating: 5
Looking at market cap, INTC is worth ~$120B while NVDA is ~$10B. On the other hand, AMD is worth around ~$12B and ATYT is worth around ~$5.5B. So intel would have to shell out ~1/12 of its value for nVidia while AMD is paying almost 1/2 of it's value for ATI.

Compared to the AMD/ATI deal, this is a drop in the bucket for Intel.


RE: PFFFF
By kamel5547 on 10/5/2006 12:08:53 AM , Rating: 5
Well... the bid would have to be a premium (30% maybe) to the current stock price, but it is well within Intels reach. The real question would would someone else bid against Intel (private equity maybe?). Owning the only independent video card firm would probably give people leverage in the industry...

The question also is would regulators allow it given Intels much stronger competitive position. Ic ould see the deal having troubles in Europe, Japan etc. where they are already in hot water over antitrust issues.


RE: PFFFF
By ani4ani on 10/5/2006 3:05:57 AM , Rating: 5
It is ironic how these like companies chase each other. I work for Siemens and that company is obsessed with GE and vice-versa. They buy X, we buy y....

It is a common joke that if GE went bust in 6 months, Siemens would hatch a way to do it in 3!


RE: PFFFF
By DannyChacko on 10/5/2006 8:39:18 AM , Rating: 1
AMD bought ATi to enter into the chipset market
Now they got a new enemy nVidia .
nVidia has done more for AMD than ATi has for intel so this may or may not be a good gamble .mind you i'm not saying that ATi is weak but nVidia is the king with a capital k.

Just imagine where AMD would be if nVidia had made nforce /nforce2 chipset exclusively for intel instead of AMD . Very few people would have bought Athlon XP


RE: PFFFF
By RandomFool on 10/5/2006 8:39:52 AM , Rating: 3
I think I read somewhere that NVIDIA wasn't interested in being bought unless they would remain in control of a large part of the company. That was during the AMD/ATI rumors though and things do change.

It doesn't seem to make much sense for Intel to buy Nvidia since they already do just about everything Nvidia can do except for mid and high end graphics cards.


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