LONDON (Reuters) – Qualcomm Inc <QCOM.O> has agreed to buy chip maker CSR Plc <CSR.L> for $2.5 billion (£1.57 billion), pushing out its rival Microchip Technology <MCHP.O> to win the British Bluetooth specialist which is growing in areas like automotive and wearable devices.

Qualcomm, the world’s number one mobile chipmaker, has agreed to pay 900 pence a share in cash for CSR, representing a 56.5 percent premium on the share price before the start of the offer period, the British company said on Wednesday.

Qualcomm’s Chief Executive Steven M. Mollenkopf said the addition of CSR’s technology leadership in Bluetooth, Bluetooth Smart and audio processing would strengthen Qualcomm’s offer in areas like portable audio, automotive and wearable devices.

“We look forward to working with the innovative CSR team globally and further strengthening our technology presence in Cambridge and the UK,” he said.

The British company in August rebuffed an approach from Microchip, saying the undisclosed price on offer was not enough. The two sides had been in talks over the deal however, with a deadline imposed by British regulators for Wednesday.

CSR, short for Cambridge Silicon Radio, specialises in connectivity, with its chips used in products such as speaker docks and Apple-owned Beats headphones.

(Reporting by Paul Sandle; editing by Kate Holton)