Intel cannot fab chips fast enough due to production capacity; and now is looking at a deal that potentially could be the largest acquisition Intel has ever made, and that would be GlobalFoundries (previously owned by AMD). The cash numbers that are floating around are $30 billion.
GlobalFoundries is owned and reported to have an original public sale later this year by the Mubadala Investment Co. Intel is in negotiations with SiFive RISC-V chip creator for a $2 billion acquisition as part of the big reorganization effort led by new CEO Pat Gelsinger. At present, GlobalFoundries accounts for around 7 percent of the worldwide sales foundry market including major clients like AMD, Qualcomm, and NVIDIA. As part of its IDM 2.0 strategy, Intel also plans to become a third-party manufacturer, investing tens of billions in capacity expansion. The fab in Ireland will also be ready for 7nm production this year and there are plans for an additional location in Europe, with a cost of 20 billion dollars.
Wall Street Journal:
Intel Corp. is exploring a deal to buy GlobalFoundries Inc., according to people familiar with the matter, in a move that would turbocharge the semiconductor giant’s plans to make more chips for other tech companies and rate as its largest acquisition ever.
A deal could value GlobalFoundries at around $30 billion, the people said. It isn’t guaranteed one will come together, and GlobalFoundries could proceed with a planned initial public offering. GlobalFoundries is owned by Mubadala Investment Co., an investment arm of the Abu Dhabi government, but based in the U.S. Any talks don’t appear to include GlobalFoundries executives, as a spokeswoman for the company said it isn’t in discussions with Intel. Intel’s new chief executive, Pat Gelsinger, in March said the company would launch a major push to become a chip manufacturer for others, a market dominated by Taiwan Semiconductor Manufacturing Co.
Intel, with a market value of around $225 billion, this year pledged more than $20 billion in investments to expand chip-making facilities in the U.S., and Mr. Gelsinger has said more commitments domestically and abroad are in the works.
Intel might purchase Global Foundries for a cool $30 billion
