The possible acquisition of silicon vendor Nvidia by Microsoft was the subject of significant speculation over the weekend, although it was subsequently revealed that this was due to a pact signed by the companies 11 years ago. InformationWeek initially reported that if a third party offers to buy 30 percent or more of Nvidia, Microsoft has an exclusive right to match this – effectively meaning that it could block any potential acquisition of the chipmaker. Some observers suggested that Microsoft may see itself as a buyer. But AllThingsD then highlighted that the deal was in place as far back as 2000 (a detail also noted in the original report), when Nvidia became the graphics chip supplier for Microsoft’s Xbox – a deal which has expired in the meantime.

Nvidia has become an aggressive competitor in the mobile space in recent months, securing some significant deals in tablets and high-end smartphones – it provides processors for Motorola’s Atrix and Droid Bionic smartphones and Xoom tablet, LG’s Optimus 2X smartphone, and Samsung’s Galaxy Tab. While the company has been mooted as a potential acquisition target previously, with Intel and Apple suggested as possible buyers, the Microsoft pact may have led to its continued independence. Nvidia was one of the companies that worked with Microsoft for its recent demonstration of its planned Windows 8 platform, which will come in a version targeting tablet computers. Following Microsoft’s recent deal with Skype, which marks its largest ever acquisition, the software giant has been perceived as being a potential buyer for a number of technology companies, including Nokia.