Discussions on a potential purchase by Intel Corp of Altera Corp have ended as the companies fail to agree on price. Apparently Altera shares rose making the company still a potential target.
Looking at Altera’s current shares, the market closed up 3.2 percent at $43.33 on NASDAQ after it fell to as much as 8 percent. On the other hand, Intel shares closed down slightly at $31.24 and this was noted after falling earlier in the day.
According to the transaction, Intel’s offer was in valued at the low end of $50 per share range. This value represented a 50 percent premium to Altera’s price which was initially reported on March 27.
As the news of the failure of the two companies to come up with a decision has spread, Intel was asked to make a comment however, till today, and the company declined an offer to provide a statement regarding the matter. Altera was also not available for any comment regarding the matter as well. Experts say that Altera’s refusal to deal with Intel adds pressure on its board.
RBC Capital Markets analyst Doug Freedman commented on the matter: “Investors are going to demand some explanations,” he said. “If the board and management can’t show a plan that would create a value at or above what Intel is offering, they are going to have to justify why they are saying no.”
To recall, Intel was reported to be in talks to buy Altera late last month in a deal that could have been worth more than $10 billion. If the deal has gone through, this purchase would have been Intel’s largest acquisition in the company’s history basically bigger than the $7.7 billion purchase of security software maker McAfee in 2011. Altera is important to Intel. The company produces superb quality programmable chips which are important in data centres and are developed for functions such as web-search results and in managing social networks.
Market analysts Peter Jankovskis, co- chief investment officer at OakBrook Investments LLC commented on the failure. He however said that they expect M&A chip to boom despite Intel and Altera ending talks of any acquisition. “Perhaps it impacts those two stocks but I don’t see it offsetting the major trend, which is certainly for more deals,” said Peter Jankovskis, co-chief investment officer at OakBrook Investments LLC
Intel Corporation is an American multinational corporation with headquarters in Santa Clara, California. It is considered “one of the world’s largest and highest valued semiconductor chip makers” according to revenue. There are many firsts for Intel; it is creator of the x86 series microprocessor that is used in personal computers. According to the 2013 rankings of the world’s 100 most valuable brands by Millward Brown Optimor showed the company’s brand value at number 61.
The most successful microchip company begun research into electrical transmission and generation. It is also the leader in 3-D transistor which is used to improve performance and energy efficiency. The Tri-Gate is a 3-D transistor that was also a first for Intel and this had 22 nm process used in their 3rd generation core processors which was released on April 29, 2012. Intel unveiled its fourth generation of Intel Core processors (Haswell) in 2013 in an event named Computex in Taipei. Intel stock market evolution: http://www.marketwatch.com/investing/stock/intc
Altera Corporation is an American company that manufactures Programmable Logic Devices (PLDs) which are reconfigurable complex digital circuits. The company’s main products are the Stratrix, Arria and Cyclone series FPGAs, the MAX series CPLDs; Quartus II design software and Enpirion PowerSoC DC-DC power solutions.
The Stratix series FPGAs are the company’s largest, highest bandwidth devices, Cyclone series FPGAs and SoC FPGAs are the company’s lowest cost, lowest power FPGAs, with variants offering integrated transceivers up to 5 Gbit/s. In between these are Arria series FPGAs, which boasts of a balance of performance, power, and cost for mid-range applications. These devices integrate FPGAs with full hard processor systems based around ARM processors.
In May 2013, Altera acquired embedded power chipmaker Enpirion. Since that time, Enpirion has been incorporated into Altera by becoming its own product offering within the Altera portfolio of products.
Altera offers an embedded portfolio with a broad selection of soft processor core such as the Nios II, Freescale ColdFire v1 core, ARM Cortex-M1 and one hard IP processor core the ARM Cortex-A9 processor. All of Altera’s devices are supported by a common design environment, Quartus II design software. Quartus II software is available in a subscription-based edition and a free Web-based edition. Altera stock market evolution: http://www.marketwatch.com/investing/stock/altr .