Dutch semiconductor giant NXP on Tuesday said it plans to acquire TTTech Auto, an Austrian company specializing in safety software for autonomous vehicles, in an all-cash transaction valued at $625 million.

TTTech Auto spun out of TTTech Group in 2018, with some $78 million in backing from the likes of AUDI, Samsung and GE Ventures. The company raised a further $285 million in 2022, with Aptiv leading its Series C round.

TTTech Auto works with the automotive industry as it pushes further into the software-defined vehicle realm, which includes semi- and full-automation. Its flagship product, MotionWise, is a middleware platform for advanced driver-assistance systems (ADAS) and automated driving systems (ADS). It provides real-time data processing to ensure the data flows between the different control systems within a vehicle, such as cameras, radars, actuators, and control units; supports integration of software from multiple suppliers; and ensures that it all meets functional safety compliance standards.

So for example, if an automaker wants to implement or improve features such as adaptive cruise control or lane-keeping assist, TTTech Auto takes all the data from sources to ensure it’s processed with minimal latency to enable the car to steer safely.

Just as Nvidia has emerged as one of the world’s most valuable companies off the back of the AI boom, NXP has been well positioned to capitalize on the automotive industry’s steady shift toward electrification and automation. Its market value has doubled over the past five years to $54 billion.

NXP, which spun out of Philips back in 2006, specializes in semiconductors for automation in various industries. For automotives, it provides chips for sensors and cameras that are critical to core ADAS features, including lane assist, automatic braking, and adaptive cruise control. Last March, NXP launched CoreRide, a platform to help automakers transition to software-defined vehicles (SDV), with TTTech Auto joining as an inaugural software partner.

There are clear synergies between NXP and TTTech Auto. While the transaction is still subject to regulatory approval, the entire TTTech Auto management team and engineering staff will join NXP, and operate under the NXP brand.