Cyrix UK, industry impressed with NatSemi deal

Cyrix UK managing director Brendan Sherry this morning welcomed the announcement of his company's intention to merge with National Semiconductor (NatSemi).

"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."

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