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Intel has confirmed earlier rumors that it’s planning to accumulate “contract” chipmaker Tower Semiconductor in an all-cash deal value $5.4 billion.
Based in 1993, Tower Semiconductor producers analog chips for a whole lot of firms throughout automotive, medical, industrial, aerospace, and extra. The Migdal HaEmek, Israel-based firm makes chips designed by different firms, and competes towards Taiwan’s TSMC, one of many world’s largest semiconductor companies.
The acquisition comes virtually a 12 months after Intel revealed plans to take a position $20 billion in two new factories in Arizona, whereas concurrently asserting Intel Foundry Providers (IFS) — a devoted unit for manufacturing chips for exterior designers. In July, Intel CEO Pat Gelsinger revealed that the corporate was speaking to at the very least 100 potential clients for IFS.
Stories additionally emerged final summer season that Intel was in talks to purchase TSMC rival GlobalFoundries for $30 billion, although the corporate elected to go public on the Nasdaq as an alternative.
Capability and attain
With Tower Semiconductor underneath its wing, Intel has given its burgeoning contract chipmaking aspirations a serious increase, each by way of manufacturing capability, world attain, and IP / know-how.
“Tower’s specialty know-how portfolio, geographic attain, deep buyer relationships and services-first operations will assist scale Intel’s foundry companies and advance our purpose of turning into a serious supplier of foundry capability globally,” Gelsinger stated in a press launch. “This deal will allow Intel to supply a compelling breadth of modern nodes and differentiated specialty applied sciences on mature nodes – unlocking new alternatives for current and future clients in an period of unprecedented demand for semiconductors.”
Ought to the transaction obtain shareholder and regulatory approval, Intel stated that it expects the deal to shut throughout the subsequent 12 months.
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