Intel to Invest Over $200M in VMware

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Computer chip maker Intel and virtualization software developer VMware announced on Monday that Intel is investing US$218.5 million in the developeris company. The deal is being managed through Intelis investment arm, Intel Capital.

VMware develops virtualization software that lets Intel-based computers run applications written for operating systems other than the one the computer is currently using. The companyis VMware Fusion application -- in beta testing phase now -- allows Mac OS X users to run Windows-based programs along side Mac programs.

The two companies have also entered into a partnering agreement to collaborate on virtualization technology development.

The stock purchase deal will give Intel about 2.5 percent of VMWareis common stock, and will also likely give the company a seat on the VMWare Board of Directors. Regulatory approval is still pending, and the companies have not stated when to expect the transaction to be completed.

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