Report: Intel, Altera Resume Buyout Talks For More Than $13 Bln Deal

(RTTNews) - Chip maker Intel Corp. (INTC) and programmable chip maker Altera Corp. (ALTR) have resumed talks on a potential deal of more than $13 billion after it was stalled in early April, according to the New York Post on Monday. A deal could be stitched up over the next few weeks.

Following the news, Altera shares are surging 7.25 percent to 47.64, while Intel shares are nearly flat at $33.10.

The proposed deal could end up being Intel's biggest acquisition, surpassing its $7.7 billion purchase of security software maker McAfee in 2011.

Intel is looking to diversify with this acquisition due to the waning demand for personal computers with the advent of large screen mobile devices.

Intel mostly makes chips for personal computers and server systems, while Altera is a specialist in programmable chips for consumer electronics, autos and other devices. Altera makes field-programmable gate arrays or FPGAs, processors that can be programmed through software.

Reports on March 27 confirmed that Intel was in advanced talks to buy Altera in a deal that could exceed $10 billion.

Later, CNBC reported on April 9 that talks between Intel and Altera have ended after the two silicon valley chip giants failed to reach an agreement on price.

San Jose, California-based Altera had then reportedly rejected an offer of $54 per share. Intel originally discussed an offer of $58 per share but revised the offer down. Altera's unaffected share price was $34.44 on March 26.

Altera's inability to successfully negotiate a deal with Intel had left a few of its largest investors such as hedge fund TIG Advisors and Cadian Capital Management red faced. TIG had started a public campaign to push for a sale.

Intel had signed a standstill agreement with Altera earlier this year, which included an option for Intel to go for a hostile takeover of Altera after June 1 if a deal was not reached before then.