Today, March 11, Santa Clara-based NVIDIA announced that it will acquire all issued and outstanding common shares of Mellanox of Yokne’am, Israel, in a deal representing a total enterprise value of approximately $6.9 billion.

Founded in 1999, Mellanox pioneered the InfiniBand interconnect technology, which along with its high-speed Ethernet products is now used in over half of the world’s fastest supercomputers and in many leading hyperscale data centers. The company employs nearly 3,000 people in Israel and in Sunnyvale, California.

“The acquisition will unite two of the world’s leading companies in high performance computing (HPC). Together, NVIDIA’s computing platform and Mellanox’s interconnects power over 250 of the world’s TOP500 supercomputers and have as customers every major cloud service provider and computer maker,” NVIDIA said in its statement.

“The data and compute intensity of modern workloads in AI, scientific computing and data analytics is growing exponentially and has put enormous performance demands on hyperscale and enterprise datacenters. While computing demand is surging, CPU performance advances are slowing as Moore’s law has ended. This has led to the adoption of accelerated computing with NVIDIA GPUs and Mellanox’s intelligent networking solutions.”

The companies have a long history of collaboration and joint innovation, reflected in their recent contributions in building the world’s two fastest supercomputers, Sierra and Summit, operated by the US Department of Energy.

The corporate statement concluded: “Once the combination is complete, NVIDIA intends to continue investing in local excellence and talent in Israel, one of the world’s most important technology centers.”

NVIDIA opened a design center in Israel in 2016, and an AI research center last October.