Intel: Nothing To Fear From The FTC
(01/08/98; 9:29 p.m. EST)
By Gabrielle Jonas and Mary Mosquera, TechInvestor
Intel said Thursday it is confident that the Federal Trade
Commission's investigation into the chip maker's proposed purchase of Digital Equipment's semiconductor operations will not encounter any roadblocks.
In October, Digital agreed to sell its semiconductor
operations to Intel for $700 million to settle a
patent-infringement lawsuit. As part of the settlement, Intel
would manufacture Alpha processors for Digital, and the two
companies also signed a 10-year cross-licensing pact.
But last month, FTC officials requested more information from
Intel and Digital about the deal.
"We continue to remain optimistic that this proposed
transaction will be approved," said Chuck Mulloy, an Intel
spokesman. "We think it's a fair transaction [and] we don't
believe it's anti-competitive."
The FTC is evaluating the acquisition part of the settlement,
said Victoria Streitfeld, a spokeswoman for the regulatory
agency. Streitfeld added that such an investigation is a
normal procedure under federal antitrust laws.
The settlement stemmed from a Digital suit accusing Intel of
using technology from Digital's Alpha microchip in its
Pentium processors.
The 10-year cross-licensing agreement would give Intel the
rights to make and sell DEC's non-Alpha semiconductor
products. In turn, Digital will be able to develop entire
systems based on Intel's IA-64.
Turning control of the Alpha chip over to Intel disarms
Digital, a formidable competitor Intel in the high-end chip
market.
But according to Intel's Mulloy, Alpha "will continue to be a
competitive product in the marketplace." Intel, he added, is
just "serving as a foundry, as a manufacturer of that part for
Digital." |
