Why Qualcomm wants to buy NXP Semiconductors

Qualcomm is in talks to buy global semiconductor manufacturer NXP Semiconductors, a deal that will reportedly cost the company more than $30 billion.

NXP Semiconductors is headquartered in Eindhoven, Netherlands and employs approximately 45,000 people in more than 35 countries, including 11,200 engineers in 23 countries.

According to "people familiar with the matter", the companies could strike a deal in the next two to three months in a bid to accelerate a consolidation rush in the semiconductor industry.

However, some of the people said Qualcomm is also exploring other deal options, so it may be that it won't happen.

Shares of NXP, which is based in the Netherlands and trades on Nasdaq, surged by 17% yesterday after the rumours of a possible acquisition spread, according to The Wall Street Journal, giving the company a market value of $33 billion.

Qualcomm stock jumped too, rising by 6.3% with the company's market value now standing at $100 billion, a sign that many of its shareholders approve of the potential deal.

Earlier this year, Qualcomm revealed one of its processors has been used to help make augmented reality possible in Google's Protect Tango tablets.

The Qualcomm Snapdragon 652 System on a Chip was used to take the weight off the back of the main CPU in a Project Tango tablet. The first consumer device, the Lenovo PHAB2 Pro, is available now.

The chip has been optimised to work better with Project Tango. The firm said that future Snapdragon 600 and Snapdragon 800-series chipsets will support augmented reality applications.