Intel reportedly offers $5-6 billion for Israel's Mellanox

Tech giant’s reported interest in computer networking products firm follows press reports last year of other firms bidding, including Microsoft

By Shoshanna Solomon 30 January 2019, 1:25 pm Edit

Shoshanna Solomon is The Times of Israel's Startups and Business reporter

US tech giant Intel Corp. has made a bid of $5 billion to $6 billion in a cash and stock deal for Israel’s Mellanox Technologies Ltd., a maker of servers and storage switching solutions, according to Hebrew-language press reports.

The bid represents a 30 percent premium on Mellanox’s closing price on Nasdaq last night, financial website Globes said.

The news of Intel’s interest follows press reports last year of other firms bidding for the Israeli firm, including Microsoft and US tech firm Xilinx Inc.

In 2017, New York activist investor Starboard Value LP acquired a 10.7 percent stake in Mellanox in a bid to improve its performance and push it to explore a potential sale.

Mellanox shares, which are traded on the Nasdaq, have advanced 24% in the past 12 months, bringing its market value to some $4.37 billion.

An Intel spokesman in Israel declined to comment on the reports about Mellanox. A Mellanox spokesman declined to comment.

Finance Minister Moshe Kahlon confirmed Tuesday that Intel will receive a $1 billion grant in return for making an $11 billion investment to expand its chip manufacturing operations in the country.