Intel in talks to buy Altera

Intel Corporation is an American Multinational corporation headquartered in Santa Clara, California. Intel is one of the world largest and highest valued semiconductor chip makers, based on revenue. It is the inventor of x86 series of microprocessors, the processors found in most personal computers. Altera Corporation is an American manufacturer of Programmable Logic Devices (PLD), reconfigurable complex digital circuits. The company released its first PLD in 1984.

People with knowledge of matter said that, Intel is in talks to acquire Altera. Altera shares jumped 28% to $44.39 at the close in New York, giving the company a valuation of about $13.4 Billion. Intel rose 6.4% to $32. Intel is on the hunt for growth as it faces a slowdown in the market for PCs that forced a $1 Billion cut in its first quarter sales forecast earlier this month. This decline comes on top of heavy losses in Intel’s mobile division. The group reported an operating loss of $4.21 Billion in 2014.

A bright spot for Intel is the data center group, where profits soared to $7.28 Billion on sales of $14.4 Billion in 2014. The company benefited from a boom in the amount of data being generated and held in computing centers around the world. Altera makes a broad range of low power semiconductors, which are used in small embedded devices and computer servers for big data centers.

In buying Altera, Intel could expand into markets for automotive, industrial and communication applications, while cementing its leads in data centers. Intel and Altera announced a manufacturing partnership in Feb 2013, agreeing that Altera chips would be made in Intel’s cutting edge plants.