Intel last night unveiled the latest in a string of networking-related acquisitions, announcing that it will buy Denmark-based communications chip design company Giga AS in an all-cash transaction valued at $US1.25 billion.
Upon completion of the acquisition, Giga will become a subsidiary of Intel and will report within Level One Communications, another wholly owned subsidiary that is part of Intel's Network Communications Group, Intel officials said.
"Intel has no plans to actually build optical switches," said Mark Christensen, vice president and general manager of the Network Communications Group at Intel. "We may do optical components, as we're still committed to being the building block supplier to the internet economy.
"Intel is investing in network processors at all levels. The net is providing intensive growth, and will require processing right in the wire. Not like a general purpose Pentium, but specialty processors, and Giga provides that capability," said Christensen, who added that the Giga purchase was the third largest in Intel's history.
The deal is subject to regulatory approvals and other customary closing conditions, Intel said.
Giga is a semiconductor design company specialising in communications chips for use in optical networking products that, for example, are used to direct traffic across the internet and corporate networks, Intel said.
With the Giga acquisition, Intel said it is targeting the market for high-performance networking chips for the fibre-optic infrastructure that the company sees as a necessary foundation for future growth of the internet.
Intel has recently embarked on a buying spree of networking-related companies. Last month it announced several such acquisitions ranging from a communications chip design company in India to the $150 million purchase of DSL chip company Ambient Technologies.http://www.giga.dkhttp://www.intel.com