Avago Technologies said it agreed to sell LSI's Axxia Networking Business to chipmaker Intel for $650 million in cash.
The Axxia business mainly includes networking and infrastructure products for wireless networks and enterprise gateways.
Avago bought LSI in December last year for $6.6 billion, and has been divesting units as it seeks to counter volatility in its main wireless business and focus on the storage chip market.
The company said in May it would sell LSI's flash storage business to hard drive maker Seagate Technology for $450 million in cash.
The companies said the deal is expected to close in the fourth calendar quarter of 2014.