Intel to close takeover of Digital's chip business this week

Intel expects to close its US$700 million takeover of Digital Equipment's semiconductor business by the end of this week -- and as a result will add the StrongARM series of low-power, 32-bit RISC processors to its portfolio, complementing its own embedded Intel architecture and i960 families. The StrongARM business will become a new division in Intel's computer enhancement group, which is excited at the prospect, according to a senior executive.

Intel expects to close its US$700 million takeover of Digital Equipment's semiconductor business by the end of this week, according to a senior executive.

As a result of the closely watched takeover, Intel will add the StrongARM series of low-power, 32-bit RISC processors to its portfolio, complementing its own embedded Intel architecture and i960 families, said Ron Smith, vice president and general manager of Intel's computing enhancement group, speaking at a press briefing at Intel's Asia-pacific Technology Forum.

"By this time next week, Digital's semiconductor business will belong to Intel," said Smith, noting that the last regulatory hurdle to closing the deal was removed last month when the US Federal Trade Commission approved the transaction.

The FTC approval, however, conditioned that Digital also must license its high-end 64-bit Alpha processor technology to certain third-party chip makers.

The StrongARM business will become a new division in Intel's computer enhancement group, which is quite excited about the new business opportunities the processor family will bring to the chip giant, he said.

"It is our intention to market, improve and expand the StrongARM product line," added Smith.

Intel will target the chips at consumer electronics areas where it has previously lacked suitable offerings, including Internet appliances such as set-top boxes, and also plans to take advantage of the ultra-low power consumption of the SA-1100 series for portable and handheld devices, he said.

In addition, Intel is also evaluating other new business opportunities for the processors, Smith said.

As part of the deal, Intel will also take over the Digital wafer fabrication plant in Hudson, Massachusetts, where the StrongARM processors are manufactured, he added.

"We will be able to offer StrongARM processors from the minute the deal is closed," said Smith.

In tel already has signed a licensing agreement over the technology with Cambridge, England-based Advanced RISC Machines, which will go into effect as soon as the Digital deal is finalised, he added.

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