By pulling ads on Gamasutra, Intel was targeted by the biased media with a stream of biased news.
It looks as if the takeover deal between Intel (NASDAQ: INTC) and Altera (NASDAQ: ALTR) was not meant to be.
According to media reports at the end of last week, Intel’s play for the FPGA and ASIC designer did not make it off the ground due to disagreements over the price. Intel is said to have offered the company $54 a share, which represents a 28% premium over Altera’s current share price. If the deal would have gone through, Intel would have spent $15 billion to complete the takeover.
Altera and Intel already work together on a number of key products. Many of Altera’s chips are fabbed at Intel’s foundries, while Intel now ships Xeon server chips with FPGAs to allow its customers to push customized workloads even faster.
Curiously, shares of Altera closed higher at the end of the Friday trading day after news that the deal was not going through broke. Ultimately this means that the play by the board shows the company is worth more than it is currently valued at.
Where does Intel go from here?
There are a number of reasons Intel was intent on grabbing Altera for itself. FPGAs will likely play an even bigger role in future Xeons to allow the chips to up their performance speed in specialized workloads.
There’s also a strategic play involved too. Intel’s Xeons aren’t the only chips that would be useful for FPGAs. If ARM (LON: ARM) ever wants to get serious about getting its processors into servers, having the option of adding an FPGA to the mix would greatly help.
Altera isn’t the only company in the FPGA game. There’s also Xilinx (NASDAQ: XLNX) which tails Altera in the same business, though the companies lack the close cooperation like Intel and Altera do.
In the end Intel is likely to try again to scoop up an FPGA player. Since Altera is out, it simply has to just go down the list of available companies until it finds one.
