Intel and Qualcomm may potentially merge their chip businesses

It could be a match made in heaven. Wall Street says Intel Corp is the best suitor for Qualcomm Inc’s chip unit, if the maker of Snapdragon mobile processors decides to break itself up. “The chip deal to end all chip deals,” says Cowen and Co analyst Timothy Arcuri, would give Intel’s smartphone chip making business a much-needed boost. It would also allow Intel to expand its footprint in the key Chinese market. Other suitors for Qualcomm’s chip business, valued at $30 billion-$40 billion, could include a consortium backed by the Chinese government and Samsung Electronics Co Ltd. Qualcomm said on Wednesday that it was weighing a possible separation of its two businesses, a move prompted by activist shareholder Jana Partners, which had a 1.7 percent stake in the company as of March 31. The maker of computing and communication chips for mobile devices has been losing ground to Asian rivals such as MediaTek Inc, whose cheaper versions have given them an edge in the price-conscious Asian market.