Chip maker maker Intel today announced its deal to acquire Wind River Systems for $884 millionin an all-cash deal for  $11.50 per share.

The acquisition will enable the Santa Clara- (California) based Intel to expand in the embedded systems and mobile device capabilities market in which the Alameda-  (California) based Wind River is a leading vendor.

Wind River specialises in embedded devices, whose software and operating system software is used in cellular phones, routers, avionics in defense aircraft, digital cameras and even on the Mars Rover robotic vehicle.

With industry leaders like Apple, Hewlett-Packard, Boeing, Motorola, NASA, and Mitsubishi using Wind River's products, the company's annual revenue for the fiscal year ended 31 January, 2009 was $360 million.

''This acquisition will bring us complementary, market-leading software assets and an incredibly talented group of people to help us continue to grow our embedded systems and mobile device capabilities," said Renee James, Intel vice president and general manager of the company's Software and Services Group. "Wind River has thousands of customers in a wide range of markets, and now both companies will be better positioned to meet growth opportunities in these areas."

Wind River will become part of Intel's strategy to expand its processor and software presence outside the traditional PC and server market segments into embedded systems and mobile handheld devices.

Intel said that Wind River will become a wholly owned subsidiary, but continue with its current business model of supplying leading-edge products and services to its customers worldwide.

Wind River develops operating systems, middleware (software found between an OS and software application), and software design tools for a variety of embedded computing systems.

Its main products include VxWorks, the market-leading proprietary and multicore-ready real-time operating system, and commercial-grade Linux software platforms.

The company also provides design services and software expertise, including custom-built solutions, development tools and device testing products.

Wind River is a publicly held company with more than 1,600 employees and operations in more than 15 countries and the software company had made 10 acquisitions since it was founded in 1981.