Marvell (MRVL) Could Look at Cavium (CAVM) or EZchip (EZCH) After Broadcom Scoops-Up NetLogic

Broadcom's (Nasdaq: BRCM) move today to acquire NetLogic Microsystems (Nasdaq: NETL) could force rival Marvell Technology (Nasdaq: MRVL) to make its own move, one analyst argues.

With Broadcom and Marvell competing in the Ethernet switch market, today's NetLogic acquisition will give Broadcom all levels of the OSI framwork, which may compel Marvel to buy companies such as Cavium Networks, Inc. (Nasdaq: CAVM) or EZchip Semiconductor Ltd. (Nasdaq: EZCH), analysts at Benchmark state.

The firm said, "Broadcom obviosly felt Netlogic's multi-core processor product roadmap was more compelling than Cavim's."

While a deal would make sense, Marvell "may be too cheap to pay the needed 35.0x-40.0x EPS in order to buy Cavium or EZchip," the firm comments.

Shares of Cavium are up 5% and and EZchip is up 8.4%.

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