Intel in talks to sell its connectivity unit to MaxLinear

Intel, the world’s largest chipmaker, is looking at reducing its footprint in areas where it isn’t competitive.

Intel’s connected home business makes chips that enable WiFi and manage data traffic for consumers (Getty Images)

Intel Corp. is in talks to sell a unit that makes chips for home internet access gear to MaxLinear Inc., according to people familiar with the matter.

No final decision has been made and Intel could keep the connected home division, the people said, asking not to be named because the matter is private. It's not clear how much the potential deal is worth.

A representative for Santa Clara, California-based Intel declined to comment. MaxLinear didn't respond to requests for comment.

Intel, the world's largest chipmaker, is looking at reducing its footprint in areas where it isn't competitive, Chief Executive Officer Bob Swan has said. The company sold its smartphone modem business to Apple Inc. in a $1 billion deal last year. Swan has pointed to the money-losing memory business as an area where he might look for a partnership.

MaxLinear, based in Carlsbad, California, provides broadband and networking semiconductors. Its shares fell 4.3% to $17.57 at 12:14 p.m. in New York trading Tuesday, giving the company a market value of about $1.3 billion.

Intel's connected home business makes chips that enable WiFi and manage data traffic for consumers. The chips provide wireless connections in home routers and gateways. Competitors include Broadcom Inc. and Qualcomm Inc.

Throughout its history, Intel has created units that push new technologies as a way to further its central processor unit.

The connected home initiative is part of an attempt to make sure Intel's computing chips find their way into the increasing number of smart gadgets being used in households.