Cortina Acquires Intel Comm Semi Assets

This is a developing story. This post will change as I learn more.

It appears Cortina Systems will purchase and operate the communication semiconductor assets of Intel (INTC).

Cortina is a privately owned company that designs and sells communication semiconductors to Telecom equipment manufacturers. They lack the capital assets to make such a purchase, and have obtained funding from outside sources.

My initial reaction is mild dissapointment. I was hoping the divestiture of the Intel assets would trigger much needed consolidation in the Comm Semi industry (see Intel’s Communication Group - Destiny Fulfilled ).

I am hopeful that this is the first of several acquisitions to be made by a consortium of investors, led by Cortina.

At this time I do not know exactly what components were sold and what price paid. It is also unclear where the optical module assets of Intel will land, though I expect either Finisar (FNSR) or Avago to purchase those.

Please use the comments to contribute what you would like to share.

UPDATE 9/5/06 - 5:10 PM- Eric Savitz at Barrons has confirmed the rumor, an announcement is forthcoming September 11th.