MediaTek has posted a filing with the Taiwan Stock Exchange (TSE) stating it was not the source of a Chinese-language Economic Daily News (EDN) report indicating the company is considering a merger with Nvidia. MediaTek added it does not comment on market rumors.

Rumors have circulated among investors that MediaTek is mulling some form of collaboration including a merger with Nvidia, which manufactures GPUs as well as SoC solutions for mobile devices, according to EDN. The two companies might work together to expand into the car-use market, the paper said.

MediaTek is looking to expand its offerings to include high-priced and high-margin chip solutions for car-use applications, while finding it hard to defend profits in the smartphone-chip market which is becoming increasingly competitive, the report indicated.

Nvidia has disclosed it already supplies chips to car vendors such as Audi, Volkswagen and Skoda. With its recently-introduced Tegra X1, Nvidia is well positioned to enter the smart automobile industry.