Intel and Altera have resumed talks about a potential $13 billion-plus buyout after earlier negotiations between the two Silicon Valley chip giants broke down, The Post has learned.
Intel, the much larger company, is looking to diversify as waning demand for personal computers weighs on its mainstay business.
“You should not be surprised if a deal comes together quickly,” said a source with direct knowledge of the talks, adding a resolution one way or the other was expected within a few weeks.
Neither company commented when contacted Sunday.
Both are big players in the semiconductor industry, but they dominate in different areas. Intel mostly supplies chips for personal computers and server systems. Altera is a specialist in programmable chips that can be customized for use in consumer electronics, autos and other applications.
An earlier round of talks between the two ended in April when Altera reportedly rejected an offer of $54 a share. Its shares were trading around $35 in March before talk of a deal leaked.
Even after negotiations stalled, Altera has been trading at an elevated price, suggesting investors are holding out hope that they will eventually reach a deal. The stock closed Friday at $44.42, up 11 cents.
“This is turning into a soap opera,” said Stacy Rasgon, a senior analyst at Bernstein Research.
He said Intel’s announcement this week that it was teaming with startup eASIC was unlikely to weaken its desire for Altera.
“It is a whole other level of programmability,” he said, referring to eASIC’s focus on chips that accelerate computer speeds.
Meanwhile, Reuters reported recently that Avago Technologies was interested in buying Altera competitor Xilinx, although discussions were still at an early stage.