Microsoft Sets Up Acquisition Deal With Nvidia
An agreement is in place between Microsoft and Nvidia relating to a possible acquisition. Microsoft will get exclusive rights to Nvidia if a third-party offers $3.4 billion or more for tablet chipmaker’s shares.
As InformationWeek reports, Microsoft and Nvidia have an agreement in place that deals with an acquisiton of the graphics and mobile processor manufacturer. The deal will give Microsoft exclusive rights to match any offer for 30% or more of Nvidia’s shares by a third-party.
“Under the agreement, if an individual or corporation makes an offer to purchase shares equal to or greater than 30% of the outstanding shares of our common stock, Microsoft may have first and last rights of refusal to purchase the stock,” Nvidia stated.
Seeing as how Apple has always looked at Nvidia for a possible acquisition, Microsoft jumped on its chance to avoid this. Microsoft and Nvidia negotiated this acquisition deal as part of an arrangement where Microsoft would license Nvidia graphics chips for use in the Xbox entertainment console.
If Microsoft ends up acquiring Nvidia, this places a major setback on the company’s rivals, especially Apple. Microsoft will end up have a better control over mobile chip components.Further reading: Microsoft, Nvidia