Home Technology Nvidia purchases chip-maker Mellanox for $6.9 billion

Nvidia purchases chip-maker Mellanox for $6.9 billion

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Nvidia has gone and bought tech company and fellow chip-manufacturer Mellanox.

The deal will see the conglomerate acquire all of the Israeli chip-maker’s issued and outstanding common shares for $125 each, a share portion to amounts to around $6.9 billion. While the acquisition had been in the rumour mill for some time, the purchase comes a few months after Intel made an acquisition offer of $6 billion.

Mellanox is a big player in the business. They are predominantly known for providing chips for high-speed ethernet and InfiniBand networks, a product that is used by nearly half of all the world’s supercomputers and cloud data centers. Nvidia’s purchase will assist in the company’s market expansion, while also spurring development in AI and cloud technologies.

“The emergence of AI and data science, as well as billions of simultaneous computer users, is fueling skyrocketing demand on the world’s datacenters,” said Nvidia CEO Jensen Huang in a company statement. “We’re excited to unite NVIDIA’s accelerated computing platform with Mellanox’s world-renowned accelerated networking platform under one roof to create next-generation datacenter-scale computing solutions.”

The two companies are strangers to each other. Many computing systems make use of both Nvidia’s GPUs and Mellanox’s interconnects, and they have collaborated on projects such as the United States Department of Energy’s supercomputers, Sierra and Summit.

“We share the same vision for accelerated computing as NVIDIA,” continued Mellanox CEO Eyal Waldman. “Combining our two companies comes as a natural extension of our longstanding partnership and is a great fit given our common performance-driven cultures.”

Nvidia experienced a rough financial start to 2019. Declines in Bitcoin mining and their latest GPUs underperforming saw company revenue drop by 22%. The acquisition should give them a boost in a technology that accounts for a nearly a third of all its sales, and is increasingly being used for autonomous cars and neural networks.

Last Updated: March 12, 2019


  1. Raptor Rants

    March 12, 2019 at 11:55

    Not surprised. nVidia is investing heavily in to cloud computing with focuses on AI and Deep learning. This will set them up nicely I reckon to bolster their cloud tech


    • HvR

      March 12, 2019 at 13:09

      Very much to do with the Deep Learning, specifically Nvidia’s DGX-1 platform of which the Mellanox Infiniband forms an integral part. Besides the Intel offer mentioned Xilinx and Broadcom was also in the mix looking to make offers and probably why Nvidia quickly forked over the extra billion.


      • Raptor Rants

        March 12, 2019 at 13:57

        A very solid acquisition IMHO. It does also make me wonder if we will see nVidia dwindle a little in the GPU department competitively. I don’t see them stopping but I wonder if they will start to refocus in other directions.


        • HvR

          March 13, 2019 at 15:16

          Not at all, think this is more of clever forward thinking expanding into new markets since the GPU market is pretty much saturated so it is very exposed to market fluctuation, currently in a recession, instead of steady growth.

          Think Nvidia owns more than 80% of discrete market share so they have AMD by the short and curlies on that front and will be very unwilling to give up market share in a multi-billion dollar market but probably since Intel is also getting into the discrete GPU playpen.

          Also both the Deep Learning and super high speed network acceleration needs to process hundreds parallel of task specific small processes just like graphic processing so it is easy for them to use the same silicone design on all three fronts.


  2. Admiral Chief

    March 12, 2019 at 12:03

    Impressive. Most impressive.

    We’ve got a high speed Mellanox 40Gbps switch for our main production environment, crazy fast


  3. Llama In The Rift

    March 12, 2019 at 11:55

    The more you buy the less you pay…it just works ne?

    Now i understand why the GPU’s are so overpriced these days.


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