Nvidia Corp said on Monday it will buy Israeli chip designer Mellanox Technologies Ltd for $6.8 billion in cash, a deal that would help the USA chipmaker boost its data center business. The segment is important as a slowdown in China and a fading cryptocurrency craze have started to weigh on Nvidia's overall sales in recent quarters. Mellanox specializes in datacenter connectivity, paratactically high-bandwidth Ethernet and InfiniBand products, for use in high-performance systems.
"The deal will strengthen NVDA's ability to offer datacenter-scale computing solutions optimized across computing, networking and storage, that can accelerate datacenter-scale workloads", Seyrafi said in a note distributed Monday.
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Mellanox is not a name we normally see much here at AnandTech, as it's often a company in the background of bigger projects.
Meanwhile, with NVIDIA's own datacenter and HPC revenues growing by leaps and bounds over the last few years - thanks in big part to the machine learning boom - NVIDIA has chose to expand their datacenter product portfolio by picking up Mellanox.
Nvidia has invested heavily in its datacentre and AI technologies over the years and acquiring Mellanox will be an extension of that.
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The agreement, which the companies described as "definitive", follows a competitive bidding process which according to sources familiar with the matter, included rival chipmakers such as Intel. Mellanox was arguably well positioned to take advantage of this growth before being acquired, and those benefits will flow to Nvidia now. Intel declined to comment on whether the company had bid for Mellanox, while Xilinx did not immediately respond to a request for comment.
Reuters reported about the deal on Sunday.
The deal is expected to close by the end of 2019.
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Mellanox gives Nvidia more entries into high performance computing and the data center. Jones Day was Nvidia's legal adviser while Mellanox's lawyers were Latham & Watkins, LLP and Herzog Fox & Neeman.
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