Why it matters: After failing to be acquired by Qualcomm last year, NXP is making a purchase of its own by buying Marvell's Wi-Fi and Bluetooth wireless assets for $1.76 billion in cash. The deal is entirely funded by Qualcomm as the company issued NXP a $2 billion break-up fee for failing to seal the deal in 2018.

Dutch semiconductor manufacturer NXP has agreed to purchase Marvell’s Wi-Fi and Bluetooth connectivity assets for $1.76 billion in cash.

The acquisition, which includes roughly 550 employees worldwide, will allow NXP to offer its customers a wide range of wireless connectivity solutions including Wi-Fi 4, 5 and 6 – the new naming convention that the Wi-Fi Alliance introduced late last year – as well as Bluetooth.

NXP expects customers in the automotive, industrial and IoT fields could benefit the most from the acquisition.

The chipmaker said Marvell brought in approximately $300 million in revenue during fiscal 2019 and anticipates doubling that by 2022.

Piper Jaffray analyst Harsh Kumar told Reuters that NXP had been underinvesting in Wi-Fi for the last few years as it assumed it would be able to access Qualcomm’s Wi-Fi tech.

Qualcomm’s bid to buy NXP for $47 billion, however, was called off last summer due to regulatory concerns in China. That put NXP behind the eight ball, likely necessitating its decision to buy Marvell’s assets and catch back up.

NXP said it expects the transaction to close by the first quarter of 2020 pending customary regulatory approvals.

Image credit: NXP Semiconductors by nitpicker