U.S. chip supplier Nvidia Corp has offered the highest bid for Israeli chip designer Mellanox Technologies and will acquire the company for $6.8 billion.

Mellanox will make chips to connect artificially intelligent servers together to create one giant computer in a bid to prioritize data centers, according to Nvidia Chief Executive Jensen Huang in an interview with Reuters.

The purchase is considered a blow to its primary competitor, Intel, which announced in February that it would be investing $11 billion into an expansion of its Kiryat Gat facility.

Intel has been operating in Israel since 1974 and employs approximately 13,000 people at Intel’s five Israeli research-and-development centers, exporting $4 billion dollars worth of products in 2018.

Mellanox will pay a $350 million termination fee to Nvidia if it accepts a rival offer, though Intel did not comment on whether it had bid for Mellanox.

The deal is expected to close by the end of 2019.

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