NVIDIA buys high-performance chip-maker Mellanox for $6.9 billion

Gladys Abbott
March 11, 2019

A bidding war for supercomputer chip maker Mellanox ended Monday with Nvidia announcing it will acquire the San Jose-based company for almost $7 billion.

Nvidia management comments on a conference call that discussions to buy Mellanox were relatively recent suggested that they may have calculated that Mellanox as part of Intel would have hindered Nvidia's long-term growth, Rosenblatt Securities analyst Hans Mosesmann said.

Nvidia has been pushing more into networking and connectivity with its own tailored solutions and Mellanox would bring further expertise along these lines, Bernstein analyst Stacy Rasgon said. Nvidia's computing platform and Mellanox's interconnects power more than half the world's Top 500 supercomputers.

Nvidia put an end to the question of Mellanox's fate when the chipmaker announced that it would acquire the company for $6.9 billion.

"The emergence of AI and data science, as well as billions of simultaneous computer users, is fueling skyrocketing demand on the world's datacenters", said Jensen Huang, founder and CEO of Nvidia.

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"Addressing this demand will require holistic architectures that connect vast numbers of fast computing nodes over intelligent networking fabrics to form a giant datacenter-scale compute engine".

According to anonymous sources speaking to newswire service Reuters, Mellanox has been offered a deal in excess of $7 billion in cash (around £5.4 billion) from Nvidia - which, if accurate, would represent the largest acquisition in the company's history.

SEE ALSO: Think you can tell between a real and computer-generated face? Today, team green announced that it has reached "a definitive agreement" to acquire Mellanox, a company that specialises in cloud computing, data centres and networking. Intel is believed to have already made a bid for the Israeli company, apparently offering US$6 billion for the network specialist.

"We share the same vision for accelerated computing as Nvidia", said Eyal Waldman, founder and CEO of Mellanox.

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