Infineon said its wireless unit accounted for $1.17 billion in earnings last fiscal year, about a third of their revenue. The company provides chips for Apple's iPad and iPhone 4, along with several other high-profile handsets. According to a statement offered by Intel CEO Paul Otellini, "The acquisition of Infineon's wireless business strengthens the second pillar of [Intel's] computing strategy -- Internet connectivity -- and enables it to offer a portfolio of products that covers the full range of wireless options." The deal is expected to close in the first quarter of next year, pending regulatory approval.
Intel is a semiconductor hardware company at its heart. But while its chips run more than 80% of the world's personal computers, they are currently absent from the cell phone market. Infineon's baseband chips could potentially be paired to work with Intel's handset-centric processing chips, like the upcoming 32nm Medfield which is posed to outclass ARM in power efficiency, making the world's largest chipmaker a compelling option for smartphone manufacturers.