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Nvidia is approaching to acquire Mellanox Technologies: Source

Chipmaker Nvidia is approaching an agreement to acquire peer Mellanox Technologies for more than $ 7 billion in cash, a person familiar with the matter said Sunday. The deal would be Nvidia's largest acquisition and increase its operations to make chips for data centers, so that it can reduce its dependence on the video game industry, for which it is most known as an important technology supplier. Nvidia has overbid Intel in the auction for Mellanox and was able to announce a deal as early as Monday, the person said. The source is not identified because the negotiations are confidential. Nvidia, Intel and Mellanox did not immediately respond to the request for comment. Financial News Website Calcalist had previously reported that Nvidia had overpaid Intel for Mellanox. Mellanox's chips operate high-speed networks that connect servers. The company, which is based in Israel and the US, had a market capitalization at the end of trading on Friday of about $ 5.9 billion. Data center revenues account for almost one third of Nvidia's sales. Nvidia, based in Santa Clara, has grown at a rapid pace in recent years under President Jensen Huang, but a slowdown in China and a fading cyrptocurrency rage has begun to weigh on its sales in recent quarters. In January, Nvidia, which has a market value of $ 91 billion, lowered its fourth quarter sales by half a billion dollars due to the weak demand for its gaming chips in China and lower than expected data center sales.…

Chipmaker Nvidia is approaching an agreement to acquire peer Mellanox Technologies for more than $ 7 billion in cash, a person familiar with the matter said Sunday.

The deal would be Nvidia’s largest acquisition and increase its operations to make chips for data centers, so that it can reduce its dependence on the video game industry, for which it is most known as an important technology supplier.

Nvidia has overbid Intel in the auction for Mellanox and was able to announce a deal as early as Monday, the person said. The source is not identified because the negotiations are confidential.

Nvidia, Intel and Mellanox did not immediately respond to the request for comment. Financial News Website Calcalist had previously reported that Nvidia had overpaid Intel for Mellanox.

Mellanox’s chips operate high-speed networks that connect servers. The company, which is based in Israel and the US, had a market capitalization at the end of trading on Friday of about $ 5.9 billion.

Data center revenues account for almost one third of Nvidia’s sales. Nvidia, based in Santa Clara, has grown at a rapid pace in recent years under President Jensen Huang, but a slowdown in China and a fading cyrptocurrency rage has begun to weigh on its sales in recent quarters.

In January, Nvidia, which has a market value of $ 91

billion, lowered its fourth quarter sales by half a billion dollars due to the weak demand for its gaming chips in China and lower than expected data center sales.

Nvidia’s acquisition of Mellanox would also constitute a profit for activist hedge fund Starboard Value, which is a shareholder in the company and reached an agreement with last year’s composition of the board.

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