With PC sales continuing to decline, the mobile market is becoming increasingly important for Intel. The company already has several Android and Windows-based mobile devices that run on its x86 chips, and could even soon be adding the Samsung Galaxy Tab 3 10.1 to that list. All of this is certainly a step in the right direction, but if Intel really wants to compete against more established mobile chipset companies like Nvidia and Qualcomm, it is going to need to take its game to the next level.
With that in mind, Intel has officially announced it has bought the satellite navigation chip business unit of ST-Ericsson, a joint venture operated by STMicroelectronics and Ericsson.
This purchase is Intel’s first acquisition since the start of its new CEO, Brian Krzanich, who has currently only been on the job for just twelve days. For those wondering the costs of the agreement, no official terms have been disclosed.
So what happens next? In the deal, Intel will acquire 130 employees across various locations that currently work for ST-Ericsson’s sat-nav chip division and that they will become part of Intel’s mobile chip unit ran by Herman Eul.
Beyond that, we can’t say exactly what Intel plans with the new GPS chip division, though it will certainly play into their future mobile strategy, and could help the company further compete with their ARM-based rivals down the road.
What do you think of the acquisition? Could Intel eventually become a bigger play in the mobile world or will the company always play second fiddle to ARM and its licensees?
May 28, 2013
Geneva, May 28, 2013. ST-Ericsson, a joint venture of STMicroelectronics (NYSE: STM) and Ericsson (NASDAQ: ERIC), today announced the signature of a definitive agreement to sell the assets and intellectual property rights (IPR) associated with its mobile connectivity Global Navigation Satellite System (GNSS) business to a leading semiconductor company.
The sale of these assets represents another step in the execution of Ericsson’s and ST’s announcement of March 18th 2013. In addition to the assets and IPR associated with this business, a world class team of 130 industry veterans located in Daventry (UK), Bangalore (India) and Singapore are anticipated to join the buyer at closing of the transaction.
The closing of the transaction is subject to regulatory approvals and standard conditions and is expected to be completed in August, 2013. ST-Ericsson estimates the proceeds from the sale, combined with the avoidance of employee restructuring charges and other related restructuring costs, will reduce the joint venture’s cash needs by approximately $90 million.
“Today’s transaction validates the leading innovation developed by ST-Ericsson in mobile navigation systems and marks a further important step towards the execution of our shareholders’ decision to exit from ST-Ericsson” commented Carlo Ferro, President and CEO of ST-Ericsson. “I am pleased that this organization will continue to develop leading-edge technologies and delighted that the team found a new home at a leading player in the semiconductor industry.”
ST-Ericsson is a world leader in developing and delivering a complete portfolio of innovative mobile platforms and cutting-edge wireless semiconductor solutions across the broad spectrum of mobile technologies. ST-Ericsson was established as a 50/50 joint venture by STMicroelectronics (NYSE:STM) and Ericsson (NASDAQ:ERIC) in February 2009, with headquarters in Geneva, Switzerland.