Takeover talks between Intel and Altera have broken off as the chip makers could not come to an agreement on price, a person familiar with the matter said.
Altera’s shares fell as much as 8 percent to $38.67 in early trading before moving into positive territory by midday, while Intel temporarily dipped about 2 percent to $30.57.
Intel’s offer was in the neighborhood of the low-$50 per share range, CNBC reported earlier on Thursday.
Intel and Altera did not immediately respond to requests for comment.
Last month, Intel was reported to be in talks to buy Altera in a deal that could have topped $10 billion.
Altera had a market capitalization of $12.6 billion as of Wednesday. Its shares had surged more than 20 percent since merger talks were first reported by the Wall Street Journal on March 27.
Had the deal gone through, the takeover would have been Intel’s largest acquisition, topping its $7.7 billion purchase of security software maker McAfee in 2011.
Altera was said to appeal to Intel for its line of programmable chips, increasingly used in data centers and customized for functions such as providing Web search results or updating social networks.
Deals in the chip sector have been expected after NXP Semiconductors’ $12 billion purchase of Freescale Semiconductor was announced last month.
Worldwide semiconductor M&A reached $31 billion last year, the most since 2011, Thomson Reuters data shows. In the 12 months through March 2, 472 chip M&A deals were made worldwide, up from 383 in the previous year.
Market analysts said they expect the M&A boom in the sector to continue despite the end of the Altera-Intel talks.
“Perhaps it impacts those two stocks but I don’t see it offsetting the major trend, which is certainly for more deals both from the standpoint of money right now being cheap and also that it’s tough to grow revenue,” said Peter Jankovskis, co-chief investment officer at OakBrook Investments.
“The alternative is to lower costs, and a good way to make that is to get bigger.”
(Reporting by Greg Roumeliotis; Additional reporting by Dan Burns, Sagarika Jaisinghani and Rodrigo Campos; Editing by Chizu Nomiyama, Meredith Mazzilli and Saumyadeb Chakrabarty)
This article originally appeared on Recode.net.