Friday, December 15, 2000

3fdx Assets Sold to NVIDIA -- 5:00 pm CST, Update by A.T. Hun

3dfx has issued a press release saying that they are in the process of selling most of the company's assets, including the names "3dfx" and "Voodoo", to NVIDIA for $112 million ($70 million in cash and a million shares of NVIDIA stock). As of the end of the third quarter of this year, 3dfx has lost nearly $300 million. Their stock is currently at $1.78 per share. The Master and I figured that something like this was inevitable (story #1 and story #2), but it is still a shock that the company that really put 3D graphics on the proverbial map no longer exists. Here's a quote from the press release:

"After aggressively pursuing a wide range of options that take into consideration the interests of our creditors, our shareholders, our employees and our customers," said Alex Leupp, president and CEO, 3dfx Interactive Inc., "we strongly believe that to reduce expenses, sell our assets and dissolve the company provides the highest return to our creditors, shareholders, and employees."

"We expect that the combined technologies of 3dfx and NVIDIA will continue the legacy that 3dfx began in 1994, " Leupp continued. "NVIDIA is the number one supplier of graphics technology to the OEM market. With the addition of 3dfx's high-quality technology that leads the retail market, we believe the combination of the two will result in even greater PC graphics leadership."

The really scary thing is that, by acquiring 3dfx and therefore also Gigapixel, NVIDIA now will have every major 3D graphics patent known to man. Since ATi and Matrox haven't exactly proven that they can remain competitive, I wonder what will happen now with no one to push NVIDIA and keep them honest. Thanks sCary for the surprising news.

UPDATE! VoodooExtreme also got their hands on a farewell letter from 3dfx founder and CTO, Scott Sellers. They also linked to a FAQ on NVIDIA's site, explaining why they are buying 3dfx' assets.

This transaction includes, but is not limited to, all the patents, pending patent applications, trademarks, brand names and chip inventory related to the graphics processor business of 3dfx. Additionally, upon closing, the lawsuits between the two companies will be dropped.

The patents and the dropped lawsuits are more than worth $112 million.

News for 12/15/2000

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