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Qualcomm acquires Atheros for 3.1 Billion deal
By siliconindia
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Thursday, 06 January 2011, 18:49 IST
Boston: On Wednesday, Qualcomm formally announced that it will acquire chip maker Atheros Communications for a $3.1 billion deal. This deal will boost Qualcomm's Wi-Fi technology which has not been performing well under its portfolio. With the Wi-Fi chipsets the San Diego based company is planning to serve the tablet devices like the Apple iPad.
Through this acquisition, Qualcomm will be introduced to Atheros' biggest customers: Hon Hai and Nintendo. Hon Hai builds Mac computers and iPhones for Apple and Nintendo which builds 3D games and 3D movies. Other trusted customers of Atheros are Dell,Hewlett-Packard and Microsoft.
Daniel Amir, an analyst with Lazard Capital Markets said that they were three positive aspects of the deal: Qualcomm could become the biggest chip player in the tablet and mobile market with introduction to Atheros' customer lineup and it can easily penetrate into the new markets including the home networking.
Atheros specializes in Wi-Fi connectivity like Wi-Fi, Bluetooth and Ethernet networking .Many of its chips are used in consumer devices, including laptops, home electronics and mobile devices, where it has started to gain market share. On the contrary, Qualcomm majors in wireless chipsets that allow cellphones to transmit data through radio towers.
With respect to shares of Atheros and Qualcomm, there was hike of 46 cents for Atheros to $44.46 and for Qualcomm the share was up by $1.07 to $52.04.