German semiconductor manufacturer Infineon Technologies has agreed to acquire the automotive ethernet business of US-based Marvell Technology in an all-cash deal valued at $2.5bn (€2.27bn).

The transaction, which includes Marvell’s Brightlane Automotive Ethernet product line and associated assets, has received approval from Marvell’s board of directors.

Subject to receipt of customary closing conditions and regulatory approvals, the deal is anticipated to conclude within the 2025 calendar year.

According to Infineon, the automotive ethernet business currently supplies more than 50 automobile manufacturers.

This business is projected to generate revenue between $225m and $250m in fiscal year 2026, the company added.

Following the deal closing, the business will be integrated into Infineon’s automotive division.

Ethernet technology is considered essential for enabling high-speed, low-latency data communication in software-defined vehicles.

Infineon expects the deal to support its presence in adjacent sectors such as humanoid robotics and enhance its research and development footprint in the US.

Infineon CEO Jochen Hanebeck said: “The acquisition is a great strategic fit for Infineon as the global number one provider of semiconductor solutions to the automotive industry.

“We will leverage this highly complementary Ethernet technology by combining it with our existing, broad product portfolio to provide our customers with even more comprehensive, leading solutions for software-defined vehicles.

“The transaction will support our profitable growth strategy going forward, including new opportunities in the field of physical AI such as humanoid robots.” 

To finance the transaction, Infineon will draw on existing liquidity and additional debt, supported by secured acquisition financing from banks.

Marvell has been increasingly focused on its data centre chip business, which reported a 78% year-on-year growth in the fourth quarter, Bloomberg reported.

Over the same period, the company’s automotive and industrial segment grew by 4.1%.

Marvell plans to discuss the transaction during its first-quarter earnings call on 29 May 2025.