Cyrix UK, industry impressed with NatSemi deal

"It's really great news for Cyrix but it's business as usual for us," said Sherry. "It's early stages and it will take 90-120 days before this unfolds. It looks very complementary."

Elsewhere, reaction was positive with watchers observing that the deal gives loss-making Cyrix a better opportunity to compete. "The world's going to look a lot different in 18 months," said a source close to the deal. "The place to be when the shells are falling is in alliances with other people."

However, the source said the price - approximately $550 million - looks small when compared to some others in the industry. "If you judge it against the [$865 million] AMD-NexGen deal you'd say it sucks but maybe that [merger] was a function of AMD's desperation."

Another industry source said the deal was a surprise in terms of the buyer being NatSemi. "Samsung would have been top of my list but this [buyout] gives Cyrix some manufacturing capability."

The source added that NatSemi seemed to be pushing the integrated processor side of the deal over the mainstream x86 chips: "I wonder if they will de-emphasise their mainstream 6x86 and 6x86MX business."

There were also snakes in the deal for some interested parties, the source said: "NatSemi will be substantially less interested in continuing the IBM manufacturing relationship and this will crater the M2 [6x86MX] in the short term."