Apple has agreed to acquire PA Semiconductor, a fabless chip company that creates high power, low cost PowerPC based processors.

The company is purchasing PA Semi for $278 million in cash in a move some say could point to the future of the iPhone and iPods. PA Semi was founded in 2003 by Dan Dobberpuhl, a lead designer of the Alpha and StrongArm chips developed in the '90's by Digital Equipment.

"Apple buys smaller technology companies from time to time, and we generally do not comment on our purposes and plans," Apple spokesman Steve Dowling told Forbes.

Apple's move to purchase the firm will come as a surprise to Intel, and the deal-making was led by a small team led by Apple CEO Steve Jobs and senior vice president, Tony Fadell.

PA Semi licenses the Power instruction set from IBM, so its chips are software compatible with PowerPC chips. The company's PWRficient chip, launched last year, offers three to four times the performance of existing chips for the same energy consumption, the company claims.