Intel Corp., the world's largest chip maker, announced a deal with Taiwan Semiconductor Manufacturing Co. (TSMC), which aims at expanding the market for Atom, Intel's smallest chip.

The two companies have reached agreement to collaborate on technology, intellectual property and other issues related to the Atom chip.

The agreement will allow TSMC, the world's largest semiconductor foundry, to build system-on-chip platforms around the Atom design.

The partnership with TSMC could lead to customized chips that could provide Intel access to new markets it can't reach alone, Sean Maloney, Intel's chief sales and marketing officer, told reporters.

"We believe this effort will make it easier for customers with significant design expertise to take advantage of benefits of the Intel Architecture in a manner that allows them to customize the implementation precisely to their needs," Paul Otellini, Intel's chief executive officer, said in a statement.

Atom, which features 47 million transistors, is Intel's smallest processor. It is designed specifically for new mobile Internet devices and simple, low-cost personal computers.