Intel Corp. could soon launch a hostile takeover of rival chip making firm Altera Corp., after a standstill agreement signed between the two companies comes to an end on June 1.

The report comes via Reuters, which cites “unnammed sources” familiar with the matter who said Intel signed the agreement earlier this year, and that the deal includes the option for Intel to launch a hostile takeover bid if the two companies couldn’t agree to terms before then. That hasn’t happened so far, with Altera reported to have turned down a bid of $54-per-share offer from Intel, a price that would value the former at around $10.4 billion. As such, it would be the biggest acquisition for Intel since its $7.7 billion buyout of security software maker McAfee Inc. in 2011.

According to Reuter’s sources, Intel officials had originally discussed offering a price of around $58 per share for Altera, after looking at publicly available information. However, after signing a non-disclosure agreement and going through Altera’s private records, Intel lowered its offer to $54 a share. Last week, Altera posted a sequential 9 percent decline in revenue for the first quarter and said it also expects weakness in its second-quarter guidance, particularly around its wireless business.

It remains unclear if Intel will take its offer directly to Altera’s shareholders, but the sources told Reuters the option remains available.

Altera could certainly be pressured into a sale though. Reuters states that TIG Advisors LLC, an Altera shareholder, protested against the company’s decision not to negotiate with Intel by opposing a nomination to the company’s board on April 27.

As such, it could be that the two companies end up back at the negotiating table. Patrick Moorhead, principal analyst with Moor Insights and Strategy, told eWEEK the deal certainly made sense for Intel, and said Altera may just be stalling to try and secure a better offer.

“I don’t know if this is over or not,” said Moorhead. “I’m not convinced the deal is over. This could be the second or third wave of discussions.”

Intel remains the world’s most dominant chip maker, but its bottom line has suffered in recent years due to the decline in PC sales. As such, the company is desperate to grab a slice of the growing market for mobile devices – including smartphones and tablets, as well as wearables and Internet of Things technology.

As such, Altera is a juicy acquisition target. The company makes field-programmable gate arrays (FPGAs), which are programmable processors that are often used as accelerators to boost system performance while curbing power consumption.

The two companies already enjoy a good working relationship. Intel has been manufacturing Altera’s ARM-based quad-core Stratix 10 processors since 2013, and that partnership was extended last year to include multi-die devices.

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