Intel Acquires Infineon Wireless Unit

Intel Corp.’s bid to finally enter the mobile-phone sector received a major boost on Monday when it acquired Infineon Technologies AG’s radio chip unit in a $1.4-billion, all-cash deal that is expected to be completed early next year.

The deal is the second significant acquisition for Intel in about ten days following the company’s $7.68 billion purchase of computer security firm McAfee earlier this month. The two acquisitions are in-line with Intel chief executive Paul Otellini’s vision to expand the company’s market. Otellini is reportedly keen on having Intel chips in the best-selling smartphones today, including Apple Inc.’s ubiquitous iPhone.

The deal could be beneficial for both sides, as Infineon, Europe’s no.2 in semiconductor manufacturing, would unload a unit that has been underperforming while Intel would gain an established radio chip company for its latest try to get a significant share of the mobile-phone business. Intel has already reached agreements with Nokia Oyj and L.G. Electronics Inc. to have its radio-chip version of its Atom brand in their future products.