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Nvidia's CEO provides details of 3dfx acquisition
Written by Gizmo   
Wednesday, 28 March 2007 18:30

By Therese Poletti
Mercury News

Nvidia Chief Executive Jen-Hsun Huang testified Monday that during talks to buy rival graphics-chip maker 3dfx, the board of 3dfx concluded that employees could not be included in the deal because of the animosity that existed between the two companies.

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The Santa Clara chip maker is being sued in federal bankruptcy court in San Jose by creditors of 3dfx, which claim that Nvidia did not pay enough for the company in 2001. Nvidia paid $70 million in cash for nearly bankrupt 3dfx and promised 1 million shares in Nvidia stock if certain financial conditions were met.

"The two companies had been in competition for so long, the animosity would be so significant that forcing their engineers to come to Nvidia would be impossible," Huang said in his second day of testimony.

Huang said the companies discussed several options before agreeing on a final deal, which included Nvidia acquiring certain assets of 3dfx - but not its employees.

But the Nvidia CEO said he always planned to recruit the former 3dfx engineers. That was his primary reason for wanting to buy 3dfx, which was known for its 3-D graphics chips and Voodoo graphics cards for video gamers.

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