Altera Rises on Report That Buyout Talks With Intel ResumedCecile Daurat
Altera Corp. shares rose to their highest value in almost four years after the New York Post reported that talks resumed about a possible buyout by Intel Corp.
Intel, the world’s largest chipmaker, has been looking for growth beyond the struggling personal-computer market. A resolution of the discussions with Altera is expected within a few weeks, the New York Post said, citing an unidentified person with direct knowledge of the talks.
Shares of Altera, which makes a broad range of low-power programmable semiconductors, jumped 5.7 percent to $46.93 at the close in New York, the highest price since July 7, 2011. The San Jose, California-based company had a market value of $14.1 billion.
Altera rejected an offer of about $54 a share from Intel last month, people familiar with the negotiations said at the time. Through May 15, the stock had gained 2.5 percent since reports that the talks broke off, signaling that investors were anticipating the discussions may resume.
Acquiring Altera may help Intel defend and extend its most profitable business: supplying server chips used in data centers. While sales of chips for PCs are declining as more consumers rely on tablets and smartphones to get online, the data centers needed to churn out information and services for those mobile devices are driving orders for higher-end Intel processors and shoring up profitability. Sales at Intel’s data-center division rose 19 percent in the first quarter as Internet companies such as Google Inc. and Facebook Inc. built out their server operations.
Intel’s stock rose 1.3 percent to $33.41.
Chuck Mulloy, a spokesman for Santa Clara, California-based Intel, declined to comment. Altera representatives couldn’t be reached.
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