Intel Completed Biggest Acquisition To Date (NASDAQ:INTC)

Intel Corp. has announced that it has completed its acquisition of Altera Corp. The Santa Clara, Calif.-based chip giant announced the Altera deal at the end of May. The $16.7 billion purchase of Altera makes Intel the second-largest maker of chips that can be programmed after leaving the factory.

Under Intel’s plans for the acquisition, Altera will operate as a new business unit that will keep the Altera brand. Existing products will continue to be manufactured by Taiwan Semiconductor Manufacturing Co., but future Altera chips will be made in Intel factories.

Intel will also increase its focus on meeting the computing needs of giant Web services that rely on the company’s Xeon processors. Internet giants, seeking faster performance for tasks like Web searches, have been augmenting Intel’s processors with chips sold by Altera, known as field programmable gate arrays (FPGAs).

The company is planning to begin selling products with a Xeon chip and an Altera FPGA in a single package in 2016. It has been estimated that the approach could result in a 30 percent to 50 percent improvement in speed over using processors and FPGAs separately.

The company is also working on a way to embed traditional processor and FPGA circuitry onto one chip. Integrating the two functions could double the performance, but we will have to wait until after 2016 to find out.

Intel is betting that its production technology can help bring integrated products to market quickly. It could also help the company in new industries, such as automobile electronic systems. It is believed that the ability to reprogram chips would allow manufacturers to bring new features to vehicles even after they have been sold to consumers.

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