Intel and Nvidia in Talks About Merge – Rumour.

Intel May Acquire Nvidia, Jen-Hsun Huang May Lead New Company

Intel Corp. and Nvidia Corp. have restarted talks about possible acquisition of the latter by the former, a recent market rumour claims. To make the rumour about a merge between the two companies that would not result into significant synergies even more weird, it is believed that Jen-Hsun Huang, a co-founder and chief executive of Nvidia, may become the head of the new company.

Huge companies, such as Intel and Nvidia, usually meet with each other to discuss potential collaborations, strategic unions, cooperation or even mergers and acquisitions. For example, after Advanced Micro Devices acquired ATI Technologies in 2006, Intel proposed to acquire Nvidia. The companies held a number of meetings, but Nvidia refused the take-over, just like it rejected acquisition by AMD earlier that year as it wanted Jen-Hsun Huang to become the chief executive officer of the new company. Intel then proposed Nvidia to license its GeForce graphics cores and integrate them into Core i-series “Ivy Bridge” and “Sandy Bridge” processors, which Nvidia also turned down.

As the chief executive officer of Intel – Paul Otellini – plans to retire in May ’13, the company is naturally looking for a decent replacement. Since Jen-Hsun Huang can clearly be a candidate for the position, Intel’s management recently held a meeting with Nvidia’s management to discuss potential acquisition once again, according to a report from BrightSideOfNews web-site, which cites a new market rumour.

The developments of relationship between the two companies are kept secret, so nobody will know anything about the proceedings until the deal is finalized.

While the discussions may be in place, it is hard to imagine that the transaction will actually take place. There are numerous reasons for that, including vast differences in corporate culture; little synergy between the two companies and potentially loads of excessive assets and/or people; inability to negotiate about the price that would satisfy both parties.

Intel and Nvidia did not comment on the news-story.