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NVIDIA & Acquisition of Mellanox Will Result In Offering Thought To Optimize Datacenter-Scale Workloads

By John F. Heerdink, Jr.

Recently, Mellanox (MLNX) announced they entered a definitive agreement with Nvidia (NVDA) whereby NVDA will be acquiring all of the outstanding and issued common shares of Mellanox in cash for $125/share resulting in a total enterprise value of  $6.9 billion approximately.

The increasing intensity of modern workloads in scientific computing, data analytics, and AI is putting enormous performance demands on hyper-scale and enterprise datacenters while CPU’s performances have slowed. Pushing accelerated computing with NVIDIA GPUs and Mellanox’s intelligent networking solutions into the picture.

Together Mellanox and NVIDIA will optimize datacenter-scale workloads, allow networking and storage stack to reach high performance, enhance utilization and lower operating cost for customers. Both the companies have a long history of collaboration and joint vision, reflected by their recent contributions in building the world’s two fastest supercomputers, Sierra and Summit, operated by the U.S. Department of Energy including many of the world’s top cloud service providers also use both NVIDIA GPUs and Mellanox interconnects.

“We share the same vision for accelerated computing at NVIDIA,”, “Combining our two companies comes as a natural extension of our longstanding partnership and is a great fit given our common performance-driven cultures. This combination will foster the creation of powerful technology and fantastic opportunities for our people.” stated Eyal Waldman, founder, and CEO of Mellanox.

“The emergence of AI and data science, as well as billions of simultaneous computer users, is fueling skyrocketing demand on the world’s data centers. Addressing this demand will require holistic architectures that connect vast numbers of fast computing nodes over intelligent networking fabrics to form a giant datacenter-scale compute engine” stated Jensen Huang, founder, and CEO of NVIDIA.

Goldman Sachs & Co. LLC served as exclusive financial advisor to NVIDIA and Jones Day as its legal advisor. Credit Suisse Group and J.P. Morgan Chase & Co. acted as financial advisors and Latham & Watkins, LLP and Herzog Fox & Neeman as legal advisors to Mellanox.

Vista Partners LLC (”Vista”) is a California Registered Investment Advisor based in San Francisco. Vista delivers timely and relevant insights via the website: www.vistapglobal.com with daily stories, weekly market updates, monthly macroeconomic newsletters, podcasts, & Vista’s proprietary equity and market research to help you stay informed and stay competitive. Vista’s mission is to invest partner capital while arming investors with a comprehensive global financial perspective across all market sectors. Vista also seeks to provide select issuers with actionable advice regarding fundamental development, corporate governance, and capital market directives.

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(Read Original Story: NVIDIA to Acquire Mellanox for $6.9 Billion in nvidia.com)


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