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Trial to pit Nvidia against creditors in chip merger
Written by Gizmo   
Thursday, 22 March 2007 11:42

Mercury News

By Therese Poletti

A high-stakes trial involving whether Santa Clara graphics-chip maker Nvidia owes money to a group of creditors over its 2001 purchase of struggling 3dfx is set to begin today in bankruptcy court in San Jose.

Read the full story at Mercury News:

One issue during the trial will be whether Nvidia, which develops some of the most popular graphics chips and cards for video gamers, properly accounted for its purchase of 3dfx. Nvidia paid $70 million for San Jose's 3dfx, which also makes graphics chips.

Nvidia now claims, according to court filings, that it overpaid for 3dfx's assets. The creditors claim Nvidia underpaid and still owes them 1 million shares of Nvidia stock as part of the merger deal.

The creditors say Nvidia did not make a second payment it was supposed to make as part of the merger agreement, forcing 3dfx into Chapter 11 bankruptcy. A spokesman for Nvidia did not return calls seeking comment on the case.

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