Intel on Thursday said it has agreed to buy embedded software maker Wind River Systems for $884 million in cash, a move that would make it possible for Intel to deliver a complete platform of software and hardware for smartphones and other mobile devices.
Under the deal, Intel would pay Wind River stockholders $11.50 a share. The Wind River board has unanimously approved the transaction, which is expected to close this summer. Once the deal is completed, Wind River's business would become a part of Intel's Software and Services Group.
Initially, Wind River's real-time operating systems and development tools will enable Intel to offer a package of hardware and software for its embedded business. Intel sells chips to device manufacturers in such areas as in-vehicle infotainment, medicine, storage, voice over IP, networking security, aerospace, and wireless telecommunications infrastructure.
In the future, Intel is expected to take Wind River technology further into smartphones and other mobile devices, which Intel is targeting with future versions of its Atom microprocessor.
"Combining Wind River with Intel hardware and you can deliver a whole platform for manufacturers to put some plastic around to make a device," John Spooner, analyst for Technology Business Research, told InformationWeek.
Indeed, in announcing the acquisition, Intel listed smartphones, mobile Internet devices, and other consumer electronics as a future target.
"This acquisition will bring us complementary, market-leading software assets and an incredibly talented group of people to help us continue to grow our embedded systems and mobile device capabilities," Renee James, VP and general manager of Intel's software group, said in a statement.
Wind River already has made moves into the smartphone market. Last October the company expanded its partnership with Kyocera Wireless to build Google Android-based handsets and sell them to carriers.
Founded in 1981, Wind River, headquartered in Alameda, Calif., has more than 1,600 employees and operations in more than 15 countries. For its fiscal year ended Jan. 31, the company reported annual revenue of $359.7 million.
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