NEW YORK (TheStreet) -- In the wake of Avago's (AVGO) announcement Thursday that it had reached a deal to acquire Broadcom (BRCM) for $37 billion, Wall Street and tech analysts expect additional mergers in the semiconductor space to come at a fast and furious pace, with Intel (INTC), Texas Instruments (TI) and other major chipmakers tagged as possible players.
Mario Morales, vice president of IDC's semiconductors research program, expects to see an acceleration of consolidation in the sector, as most of the large companies are looking for areas where they can find pockets of growth, such as the analog chip business. "Another prime area for acquisitions is in the analog market, with companies like TI, Linear Technology (LLTC), Maxim Integrated Products (MXIM), Analog Devices (ADI) and quite a few others" in play either as buyers or targets, Morales said.
Analog chips are used in automotive, communications and industrial systems. They differ from digital chips by operating on different levels of current and voltage, while digital chips use only binary variables: 1s and 0s.
In a research note written on May 27, UBS analyst Stephen Chin said he viewed Avago's acquisition of Broadcom positively, and rated Avago a buy, saying the deal looks good from several perspectives.
"This may be the biggest deal we see, but it will not be the last," said Bill Kreher, a senior analyst with Edward Jones, said of the Broadcom-Avago merger.