After much speculation we finally have news about Nvidia’s alleged plans to acquire Mellanox.

As it turns out, Nvidia will be acquiring the chipmaker for a massive $6.9 billion which works out to Nvidia paying $125 per share.

The offer comes after something of a bidding war for Mellanox that saw Microsoft, Intel and Nvidia competing to acquire the company. Microsoft was the first to make a bid before Intel offered a reported $6 billion for the firm.

Neither of those bids seem to have mattered in the greater scheme of things however and by the end of 2019, Mellanox will officially be a part of Nvidia.

This is good news for Nvidia. While the firm’s GPU technology is well-known, that side of the business isn’t as profitable as it once was. Acquiring Mellanox means that Nvidia can diversify it’s data centre business as the Israeli-American firm powers high-performance computers as well as supercomputers.

As founder and chief executive officer at Nvidia, Jensen Huang explained, the emergence of AI and data science has led to increased demand from data centres. Add 5G and the IoT revolution it will enable and you’ve got a recipe for strained data centres.

“With Mellanox, Nvidia will optimize datacenter-scale workloads across the entire computing, networking and storage stack to achieve higher performance, greater utilization and lower operating cost for customers,” the firm said in a statement.

Speaking of the planned acquisition, Nvidia’s Huang said, “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. I am particularly thrilled to work closely with the visionary leaders of Mellanox and their amazing people to invent the computers of tomorrow.”

The board of directors at both Nvidia and Mellanox have approved the deal and subject to regulatory approval, Mellanox will enter the Nvidia fold by the end of 2019.

[Source – Nvidia]