NVIDIA to Acquire ULi Electronics for US$52 Million

NVIDIA today announced that it has signed a definitive agreement to acquire ULi Electronics Inc. (ULi), one of the PC industry’s most highly-regarded core logic developers. Headquartered in Taipei, ULi also has offices in Hsinchu; Shanghai; Shenzhen; and San Jose, California.

ULi is recognized for its innovative core logic technology as well as other multimedia and embedded products. The acquisition represents NVIDIA’s ongoing investment in its platform solution strategy, which leverages the acclaimed NVIDIA nForce® media and communications processors (MCPs) and NVIDIA® GeForce® and NVIDIA Quadro® graphics processing units (GPUs). Additionally, the acquisition is expected to strengthen the Company’s sales, marketing, and customer engineering presence in Taiwan and China.

Under the terms of the agreement, NVIDIA will pay 19 New Taiwan Dollars in cash for each outstanding ULi share and stock option, for a total of approximately $52 million (USD). The acquisition, which is expected to be completed in the first quarter of the Company’s fiscal year 2007, remains subject to the satisfaction of regulatory requirements and other customary closing conditions.

Alex Kuo, president and chief executive officer, ULi, will join NVIDIA as a senior executive responsible for MCP sales, marketing, and support functions in Asia. NVIDIA intends to supply ULi customers with current products for the foreseeable future.

NVIDIA - NVIDIA to Acquire ULi Electronics

Through the acquisition, Nvidia is hoping to weaken ATI’s presence in the global chipset market, noted industry sources. ULi currently supplies southbridge chips for use with ATI Technologies’ Pentium 4 northbridge chips.

In addition, Nvidia is looking to enhance its relationship with United Microelectronics Corporation (UMC) through the acquisition of ULi, the sources said. Nvidia currently places its major graphics processor unit (GPU) and chipset orders with Taiwan Semiconductor Manufacturing Company (TSMC), which is an exclusive 90nm chip supplier for the graphics chip vendor, the sources added.

DigiTimes - Nvidia to acquire ULi for US$52 million, gunning for ATI

ATI did consider buying ULI but we don’t know why it didn’t. We guess ATI has huge trust in its chipset unit.

Nvidia obviously needed a patent or two from ULI, a long time chipset manufacturer, and it certainly didn’t want ATI to get it first. So it reached intoo its pocket and acquired this company for not that much money. It sure got itself a bunch of nice engineers and more importantly, it prevented ATI from getting them.

This has to be a huge slap in ATI’s face as this means that ATI will have to act on its own, unless it makes an agreement with remaining chipset manufacturers.

the Inquirer - ULI’s acquisition by Nvidia is a blow to ATI