Intel announced on Monday it had agreed to acquire privately held network chipmaker Lantiq for an undisclosed amount to further push into the “Internet of things”.
The Santa Clara, California-based company said it had reached a definitive agreement with Lantiq-owner Golden Gate Capital to purchase the German maker of communications chips.
Lantiq was created in 2009 after the semiconductor manufacturer Infineon Technologies AG sold its wire-based communications division to the San Francisco investment firm in attempt to raise capital during the recession. Back then the deal was valued at €250 million or $400 million.
In 2012 Lantiq, which currently has around 1 000 employees, replaced Christian Wolff with Dan Artusi as Chief Executive Officer, former CEO and board member of Irvine, California-based Conexant.
Intel, famous for its microprocessor chips, has been diversifying its business in many different technology segments, including gateway chips.
The company said the acquisition of Munich-based Lantiq would boost Intels efforts to “make everything smart and connected, best with Intel.”
The so-called “smart gateways” help people to connect to the Internet over cable network. Intel also said that Lantiq would help increase its presence in gateway markets, including DSL, Fiber, IoT smart routers and LTE.
British communications group BT announced on Friday that its fiber technology would support speeds of up to 500Mbps to most of the UK within a decade, while LTE or long-term evolution is widely considered to completely replace the current 3G technology used is most smartphones.
The technology to connect all sorts of items, including keys, refrigerators, cars and industrial machines, to the Internet is highly contested by companies. According to tech ABI Research, devices using IoT or M2M (machine to machine) technology will more than double within ten years. The researcher also projected that the majority of the increase will be supplied from devices different from personal computers and smartphones.
Last year, Google acquired IoT specialist Nest Labs Inc for $3.2 billion, while Samsung Electronics purchased start-up SmartThings for $200 million.
“The combination of our cable gateway business with Lantiqs technology and talent can allow global service providers to introduce new home computing experiences and enable consumers to take advantage of a more smart and connected home.” said Kirk Skaugen, senior vice president of Intels client computing group.
Intel Corp fell 3.42% on Friday and closed at $33.04 on the NASDAQ, marking a one-year increase of 33.55%. The company is valued at 159.75 billion. On Monday the stock gained 0.12% at 13:11 GMT during pre-market trading.
According to CNN Money, the 41 analysts offering 12-month price forecasts for Intel have a median target of $38.00, with a high estimate of $50.00 and a low estimate of $23.00. The median estimate represents a 15.01% increase from the last close price.
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