The European Commission (EC), cooperating closely with the US Federal Trade Commission, gave the green light to Intel’s acquisition of semiconductor company Altera for $16.7 billion, saying that “the merged entity would continue to face effective competition in Europe”.

Margrethe Vestager, the EU competition chief, said she is “glad that we can approve this transaction, which shows that multibillion euro deals in complex industries can be cleared unconditionally after an initial investigation.”

“Our decision demonstrates that relevant deals can be swiftly approved if they raise no competition concern,” she added.

The deal will couple Intel’s products and manufacturing process with Altera’s field-programmable gate array technology (FPGA). This is “expected to enable new classes of products that meet customer needs in the data centre and Internet of Things market segments”.

The EC said its investigation focused on several semiconductor markets as well as the “vertical relationship” between Intel’s contract manufacturing services and Altera’s activities in the supply of FPGAs and complex programmable logic devices.

It found that Intel has a very limited position in the market for contract manufacturing services and Altera’s demand for such services is of limited importance as compared to overall market demand.