Marvell Technology to buy chipmaker Cavium for about $6 billion

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In another consolidation move in the semiconductor industry, chipmaker Marvell Technology announced it will acquire competitor Cavium Inc. for approximately $6 billion. It’s estimated that the combined company will generate about $3.4 billion in annual revenue.

Bermuda-based Marvell makes semiconductors for data-storage devices while California-based Cavium produces communications and networking chips. The deal better positions Marvell to compete with bigger rivals, including Intel and Broadcom, in a semiconductor industry that has changed a lot over the past couple years as companies buy out rivals.

“This is an exciting combination of two very complementary companies that together equal more than the sum of their parts,” Marvell’s president and chief executive officer, Matt Murphy, wrote in a statement. “This combination expands and diversifies our revenue base and end markets, and enables us to deliver a broader set of differentiated solutions to our customers.”