By Dan Jones
VIA Technologies Inc is trying to become the leader in low-end PC processor market and has announced its intention to buy another failed x86 contender, IDT’s Centaur Design unit after the finalization of a $167m deal to buy National Semiconductor Inc’s Cyrix x86 PC processor division. VIA said that the Centaur x86 design team, IP portfolio and WinChip technology was valuable to the company on top of Cyrix. The price of the acquisition has not been announced yet but is expected to be less than the money paid for Cyrix.
When the acquisitions are completed, VIA will become the third- largest PC processor player in the world after Intel Corp and Advanced Micro Devices Inc. Jonathan Chang, a VIA spokesperson, said that the company would not be beaten out of the low-end market by Intel, like the two x86 units it is buying, because it could achieve a higher profit margin on its low-end designs than Intel. Chang cited VIA’s strong links with Asian motherboard manufacturers and system houses as part of the reason it would survive and prosper in this savage sector. VIA intends to be become the largest designer of low-end CPUs and chip infrastructure in the world. We believe the low-end is the most growing market and we only see that continuing, Chang said. A fabless company, VIA has foundry deals with NatSemi, Taiwan Semiconductor Manufacturing Co and United Microelectronics Corp. The agreement with IDT will also see VIA working with IBM Corp.
VIA is confident that it can overcome Intel’s legal suit against it. Chang said that the company had carefully evaluated the case against it and wouldn’t have made the Natsemi and IDT deals if it was not confident of a sound legal footing.
The acquisitions of Cyrix and Centaur will drastically change the shape of the PC processor market. Some in the industry have suggested that Rise Technologies Inc is the next company on VIA’s shopping list. Chang said that VIA was aware that the company was up for sale – contradicting the start-up’s own claims – but said that VIA had no plans to buy the Californian company at present. A source close to Rise said that there were a lot of companies watching VIA’s current activities – particularly motherboard manufacturers and graphics chip makers – and considering Rise as a possible acquisition target. There are a lot of tire kickers around, said the source. ATI Technologies Inc and Acer Group are two companies that could be in the running.
