Intel

(INTC) - Get Report

cut loose another part of its business Monday, with the sale of its optical-networking chip business.

The deal, which closed on Friday, sends a slew of products designed for telecommunications infrastructure to privately held

Cortina Systems

.

Intel said it received an undisclosed amount of cash as well as a minority equity position in Cortina. An Intel representative declined comment on published reports that pegged the amount at $115 million in cash and stock.

The deal represents the latest in a string of divestitures by the chip giant. In June,

Intel sold its communications and applications processor business to

Marvell Technology

(MRVL) - Get Report

for $600 million. Last month Intel said it was selling its media and signaling chip business to

Eicon Networks

.

Stung by fierce competition and plummeting prices in the PC microprocessor market, Intel is in the middle of a top-to-bottom review of its business. Last week the company announced that it would eliminate 10,500 jobs from its payroll by mid-2007.

Intel acquired portions of the optical-networking business through its $2.2 billion acquisition of

Level One Communications

in 1999, one of several expensive but generally unsuccessful deals Intel made to expand its business at the time.

The chipmaker does not disclose the revenue generated by the optical-networking business or its profitability.

Intel spokesman Len Schulwitz said the negotiations for the deal were well under way before the recent cost-cutting program, although he added that the 120 jobs that are part of the divested group will be included in Intel's staff reductions.

Cortina has extended offers of employment to a significant number of the affected employees, according to the announcement.

Schulwitz said that Intel had achieved its original goals by entering the business, which was to offer industry standard components instead of the proprietary products that previously defined the market.

"We have an ongoing commitment to communications, and we want to focus on the communications and embedded market segments that are most closely aligned with our core business," said Schulwitz.

Shares of Intel were up 2 cents, to $19.42 in extended trading Monday.