Santa Clara, California’s Intel Corp. (NASDAQ: INTC – $51.42) has agreed to purchase a software business from Toronto-based Pivot Technology Solutions Inc. for $27 million in cash. Intel said it would purchase Smart Edge, a software business that is designed to help split up data and store it closer to users to make computing devices respond faster. The software is designed to run on Intel’s chips, which are best known as the heart of most personal computers but which the company is aiming to sell into equipment for 5G, the next generation of wireless data networks that is being rolled out starting this year. Smart Edge will join Intel’s Network and Custom Logic Group. In connection with the purchase the two companies have entered into a three-year preferred channel partner agreement which designates Pivot as a non-exclusive preferred system integrator and channel partner for Smart Edge based solutions. Under this agreement, Pivot will market Smart Edge solutions and provide customers edge services including deployment, system integration, monitoring and support.
I continue to like Intel for conservative income accounts. The shares, yielding 2.4%, offer appeal as a long-term holding, particularly on a risk-adjusted basis. The current $1.26 annual dividend is well covered and has grown about nine percent annually over the past ten years. The company’s immense size gives it a leg up on the competition and should enable it to withstand industry downturns better than most.