Microsoft and Nvidia Have Acquisition Pact

An anonymous reader writes "Infoweek is reporting that Microsoft has obtained the exclusive right to match any buyout offers for Nvidia. The obscure pact was uncovered in SEC documents, and apparently stems from Microsoft's licensing of Nvidia chips for the Xbox. But its real value now lies in the fact that Nvidia has become a major player in tablet chips, including chips for Windows 8 slates."

I say the oppsite

[Osgeld]

when XBOX was using nvidia chips (thats XBOX1, 360 uses an ATI system) Nvidia was a smaller company in a fairly new and fairly niche industry catering JUST to game geeks.

its not the same playing field in 2011

Re:Soo, if I wanted to bankrupt Microsoft

[Dragonslicer]

Presumably, Nvidia's side of the agreement is that if Microsoft chooses to match an offer, Nvidia has to accept Microsoft's offer instead of whoever else made an offer.

Re:Anti-competitive little shits

[Sprouticus]

I'd say RTFA, but this is slashdot.

This is a devensive measure by MS in case Sony or Nintendo (or some other company) decided to buy NVidia and then screw over MS in a effort to sink the XBox. Not saying it would happen, but that is the idea.

MS does not want to buy NVidia, they just want to be sure one of their few revenue streams doesnt go away.

Re:MS is not a hardware company

[Darkness404]

True, but if you are only single-tasking and you optimize your game for the hardware it is pretty impressive what you can do. Heck, the PS3 only has 128 MB of RAM, the Wii only has 88 MB of RAM, etc. On the other hand, a typical PC has lots of things going at once, after all, how many programs does the typical /.er have open even when they are just browsing the internet? Music, Skype, a video playing in the background, some updates downloading etc.

Re:MS is not a hardware company

[the linux geek]

Slashdot inexplicably submitted instead of previewing. Here's the source:

http://blogs.msdn.com/b/xboxteam/archive/2006/02/17/534421.aspx [msdn.com]

Re:Chair game.

[ColdWetDog]

M$ is acquiring / making deals with companies which are key to Linux -- related to Gnome (Novell), KDE & Qt (Nokia), Skype (ok, it was weak but could become important) and Nvidia (the _only_ hardware recognized as allowing video h/w in Linux) -- I don't whether they want to suffocate ("cut the oxygen of") Linux (actually, they probl think "Ubuntu") or they plan to get cozy to pinguins as a last resort against Apple.

It's getting me nervous.

If that's the way you think about things, you should be getting nervous. And it doesn't have anything to do with Microsoft.

Re:Soo, if I wanted to bankrupt Microsoft

[Bacon Bits]

Just how many years had Nvidia's lawyers completed before they signed this kind of agreement with no less than Microsoft?

More than you, clearly.

"We agree that you will have tens of millions of sales of your product for which we will pay you, and should anyone try to buy your company, we can offer to buy you out for the same price. So if you get one offer to be bought out, you pretty much get two."

You know what happens when a company is bought out? The executives, lawyers, and owners/shareholders make a boatload of cash. This was basically win/win for nVidia (unless they had really good prospects or wanted to be bought out by another company) while assuring MS that they won't lose the source of their chips to a competitor without a chance to stop it. All this does is discourage other parties from making lowball offers. All MS would do is hold on to nVidia until they no longer needed the chips, then spin it off.