The Associated Press

SANTA CLARA, Calif. – Intel (nasdaq: INTC) says it’s buying a Texas Instruments (NYSE: TXN) unit that makes cable modem chips, which it intends to combine with its own processors for smarter modems and cable set-top boxes.

The companies did not reveal the terms of the deal in the Monday announcement.

Dallas-based Texas Instruments Inc. has supplied Motorola, Arris and Cisco’s Scientific Atlanta unit with chips for cable modems, representing much of the U.S. market.

Santa Clara-based Intel Corp. says all employees of the TI unit have been offered positions. It expects the deal to close in the fourth quarter.

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