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Will Intel buy Infineon wireless?

Posted: 06 Aug 2010 ?? ?Print Version ?Bookmark and Share

Keywords:wireless? acquisition?

Intel is the most likely buyer for Infineon's wireless business now up for sale, though Broadcom is a better fit and Samsung is clearly interested, according to market watcher Will Strauss, principal of Forward Concepts.

Infineon said earlier this week it is making progress in discussions to sell its wireless group which generated about $1.2 billion in sales last year. That represents about a third of total revenues at Infineon which is seeking to focus on its larger and more profitable automotive chip business.

"I'd like to see Broadcom get it, but it would be a financial strain for them," said Strauss, principal of Forward Concepts." Broadcom probably understands the [wireless] market better than Intel does now or will anytime soon," he said in an interview.

Intel has the financial resources to acquire the Infineon chip unit, especially now that it has ended a long standing antitrust investigation from the U.S. Federal Trade Commission without being slapped with a fine. Intel is hungry to get into the smart phone business with its Atom processor and related SoCs, but to date has lacked much of the silicon surrounding a cellular applications processor.

The prize is a rich one because Infineon supplies 3G cellular modems and RF transceivers to all Apple iPhones and iPads. Strauss said Apple represents as much as 40 percent of the Infineon group's business.

That could be a big boost for Broadcom which sells Wi-Fi and Bluetooth chips to Apple and others, but has a small share of the 3G baseband business overall, Strauss noted. Apple shifted to Intel for all its computer processors, but so far has used ARM-based chips from Samsung and others in its mobile systems.

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