Nvidia outstrips Intel bid to buy Israeli chip designer Mellanox

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Nvidia outstrips Intel bid to buy Israeli chip designer Mellanox

On Monday (March 11th), during the US morning trading session, the US chipmaker Nvidia Corp. had agreed to purchase the Israeli chip designer, Mellanox, at a $6.8 billion buyout offer, beating Intel Corp.’s $6 billion bid, which would likely to help the US chipmaker supplement their supercomputer business and data center activities.

Following the release of the takeover deal, the shares of Mellanox jumped 8.4 percent to $118.56 per share, while Nvidia shares also gained roughly 7 percent to $161.14, listed in Nasdaq on Monday (March 11th). Never the less, Mellanox would have to pay a $350 million cancellation fee to Nvidia, if it accepts a rival offer, terminating the previous deal, although both companies had already described the accord as “definitive”.

As of Monday (March 11th), Intel declined to comment whether they bid for Mellanox, while addressing to a growing significance of artificial intelligence and data science, the Chief Executive Officer of Nvidia, Jensen Hung said, “he emergence of AI (artificial intelligence) and data science, as well as billions of simultaneous computer users, is fueling sky-rocketing demand on the world’s data centers”.

Analysts had also added that Nvidia had been pushing hard in the recent past into networking and connectivity utilizing the resources they had and Mellanox seemed to be bringing further expertise and intel into the US chipmaker.