NEW YORK (AP) -- Broadcom has agreed to acquire NetLogic Microsystems Inc. for what the chip maker says is about $3.7 billion in cash.
Broadcom chips are used in products ranging from cable boxes to cell phones. It says NetLogic will extend its product line with a number of new processors.
Broadcom Corp., which is based in Irvine, Calif., says it has agreed to pay $50 a share for NetLogic. That is a 57 percent premium to Santa Clara, Calif.-based NetLogic's closing price of $31.91 on Friday.
Netlogic shares climbed 51 percent to $48.04 in premarket trading Monday.
The transaction has been approved by both companies' boards. It needs both regulatory clearance, but is expected to close in the first half of next year.
Broadcom expects the acquisition to boost earnings by about 10 cents per share next year.