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Intel Buying Infineon Wireless Biz for $1.4 Bln

Chipmaking giant Intel is making another high-profile acquisition, announcing that it is acquiring Infineon’s Wireless Solutions Business (WLS) in a cash deal valued at about $1.4. billion. The acquisition will help bolster Intel’s efforts to expand beyond traditional computer processors (and embedded systems based on the same technology) into mobile communications and new types of mobile, Internet-connected devices. Pending regulatory approvals, the deal should conclude in the first quarter of 2011.

“The acquisition of Infineon’s WLS business strengthens the second pillar of our computing strategy—Internet connectivity—and enables us to offer a portfolio of products that covers the full range of wireless options from Wi-Fi and 3G to WiMAX and LTE,” said Intel president and CEO Paul Otellini, in a statement.

Infineon is based in Neubiberg, Germany; the company is a leading maker of mobile chipsets, widely used in smartphones and a broad range of existing and forthcoming mobile devices. During Infineon’s most recent fiscal year, the mobile unit accounted for over €900 million in revenue.

Intel has previously relied on partnerships with electronics giant LG and handset maker Nokia to provide wireless chips. Intel has been strengthening its relationship with Nokia with the new MeeGo open source mobile operating system; however, Intel’s efforts to built a wireless chip business latched to its Atom family of processors have not met with strong success.

The transaction marks Intel’s second major acquisition in recent weeks; the company also announced a deal to acquire security software vendor McAfee in a deal valued around $7.8 billion. The McAfee acquisition also factors into Intel’s plans to be a dominant player in the mobile market.

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