Atheros To Buy Intellon For $244 Million

SANTA CLARA, Calif. (AP) — Atheros Communications Inc. plans to acquire Intellon Corp. for $244 million in cash and stock, the companies said Tuesday.

Orlando, Fla.-based Intellon designs chips for allowing high-speed network connections through power lines. Atheros, based in Santa Clara, Calif., makes chips that go into wireless communications equipment.

In a statement, Atheros CEO Craig Barratt said the deal will allow the company to offer a combination of "wireless and wired bandwidth, providing robust transmission of data, voice and multimedia content on the growing number of networked devices in the home."

The companies value the deal at $181 million after accounting for Intellon's cash and other financial assets.

Atheros said it will pay for 45 percent to 55 percent of the acquisition in stock and the rest in cash. The offer values Intellon shares at $7.30 each.

Intellon shares closed Friday at $5.

Atheros also raised its third-quarter earnings forecast. The company now expects adjusted earnings of 35 cents to 39 cents per share, up from a previous prediction of 29 cents to 31 cents. On average, analysts expect profit of 30 cents per share, according to a survey by Thomson Reuters.