18 , 2000
Last week PC graphics card maker Nvidia announced that it has signed a definitive agreement to acquire certain graphics related assets of 3dfx Interactive, the maker of Voodoo graphics cards. 3dfx had just this year released its first Macintosh graphics cards, the Voodoo4 4400 and Voodoo5 5500 PCI cards. The company recently called off plans to write Macintosh drivers for the AGP version of the Voodoo5.
3dfx, in turn, will be closing its doors entirely and laying off about 600 workers. Nvidia said today in a conference call with investors that it will be offering jobs to more than 100 of 3dfx's engineers by end of day today. A company spokesman said this will allow Nvidia to "accelerate entry into new markets." Nvidia currently offers no graphics cards for the Mac market, but speculation about its plans to offer Mac hardware has been rampant since this summer.
As a part of the acquisition, Nvidia gets patents, pending patent applications, trademarks, brand names and chip inventory related to the graphics business of 3dfx. The company said the likelihood of Voodoo-branded video cards being released under the Nvidia name is strong. The company said it's also likely we'll see Voodoo cards released in the future with Nvidia technology on board.
Much of the plans for 3dfx's assets are yet to be determined, according to Nvidia.
Under the terms of the agreement, Nvidia will pay to 3dfx a total consideration of $70 million in cash and 1 million shares of common stock. The asset acquisition has been approved by the board of directors of each company and is subject to 3dfx shareholder approval and other closing conditions. This acquisition will be accounted for as a purchase and is expected to be complete in the first quarter of Nvidia's fiscal year 2002.
For more information, visit http://www.nvidia.com.
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