Nvidia on Monday announced that it had agreed to acquire graphics vendor Ageia Technologies for an undisclosed amount.

Ageia, which makes graphics hardware and software, will add features to Nvidia's graphics products that will boost the physical reality users experience while playing a game, said Derek Perez , an Nvidia spokesman.

Ageia developed PhysX, a hardware and software engine that adds physical reality to existing games, like smoke billowing from an object after an explosion, or the behavior of a rock after it hits a target. Developers can also use the PhysX software development kit to create interactive middleware for games. Ageia recently provided a kit to developers to create physical experiences in Epic Games' Unreal Tournament 3.

Roughly 140 titles for PCs, Sony Playstation 3, Microsoft Xbox 360, Nintendo Wii and gaming PCs support the PhysX engine, according to Ageia.

The PhysX engine requires massive parallel computing capabilities to execute and fits into Nvidia's CUDA (compute unified device architecture) technology, Nvidia's Perez said. CUDA allows software developers to write programs that instruct the graphics processing unit (GPU) to perform some computing functions normally done only by the CPU.

Nvidia's first step will be to get the physics processing of PhysX hardware and software into Nvidia's GPU, and then to get PhysX to interact with CUDA technology, Perez said.

Like graphics, physics processing crunches algorithms and requires millions of parallel computations which CUDA technology on Nvidia cards can execute, Nvidia said in a statement.

"The computer industry is moving towards a heterogeneous computing model, combining a flexible CPU and a massively parallel processor like the GPU to perform computationally intensive applications," like physics applications, said Jen-Hsun Huang, president and CEO of Nvidia in a statement.

CUDA works with Nvidia's GeForce 8800GT graphics processing unit, which has 112 processors to crunch parallel applications.

There will be no layoffs resulting from the acquisition, Perez said. Both companies are located in Santa Clara, California.