Intel is in talks to buy GlobalFoundries for about $30 billion, a deal that would create the world’s largest chipmaker. The acquisition comes as Intel faces slowing sales growth and a shrinking market share.
The globalfoundries revenue 2020 is a company that Intel is in talks to buy for about $30 billion.
According to individuals familiar with the issue, Intel Corp. INTC -1.26 percent is considering a deal to acquire GlobalFoundries Inc., a move that would accelerate the semiconductor giant’s ambitions to manufacture additional chips for other tech firms and would be its biggest acquisition ever.
According to the individuals, a purchase might value GlobalFoundries at about $30 billion. It’s not a given that one would materialize, and GlobalFoundries may still go through with its planned IPO. Mubadala Investment Co., an investment arm of the Abu Dhabi government, owns GlobalFoundries, which is located in the United States.
GlobalFoundries officials do not seem to be involved in any conversations with Intel, according to a spokesperson for the firm.
Pat Gelsinger, Intel’s new CEO, said in March that the firm will make a significant effort to become a chip maker for others, a sector that is controlled by Taiwan Semiconductor Manufacturing Co. -5.51 percent TSM
Intel, which has a market capitalization of about $225 billion, committed more than $20 billion in investments to expand chip-making facilities in the United States this year, and Mr. Gelsinger has indicated that additional pledges are in the works both domestically and internationally.
GlobalFoundries is one of the world’s biggest chip manufacturers. It was formed after Advanced Micro Devices Inc., an Intel competitor, decided to spin off its chip-making activities in 2008.
At a GlobalFoundries plant in Singapore, a worker holds a chip wafer.
Photo courtesy of The Wall Street Journal’s Edwin Cheng.
AMD is still a major client for GlobalFoundries, having signed a multiyear, $1.6 billion chip-component supply agreement this year, which may make an Intel acquisition more difficult. GlobalFoundries is moving its corporate headquarters from Santa Clara, California, to Malta, New York.
According to Taiwan-based research company TrendForce, GlobalFoundries has approximately 7% of the foundry market share by revenue. Qualcomm Inc. QCOM -1.59 percent and Nvidia Corp. NVDA -4.41 percent, two of the biggest semiconductor firms, depend on third-party manufacturers to manufacture their products, preferring to concentrate on design rather than the hassles of operating their own factories. Last year, Nvidia surpassed Intel as the most valuable semiconductor firm in the United States.
GlobalFoundries, like Intel and TSMC, is increasing its production footprint in the face of a worldwide semiconductor scarcity. Last month, GlobalFoundries announced that it had broken ground on a new chip manufacturing facility, or fab, in Singapore, spending more than $4 billion in the project.
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The scarcity has hampered production in a variety of industries, resulting in the temporary closure of automotive manufacturers and decreased supplies of goods such as computers and certain appliances.
Car manufacturers have been especially severely affected, since they have been unable to get enough chips for all of their cars. Electronics prices are beginning to rise as a result of the shortages.
President Biden has pledged to help alleviate the chip shortage by spending billions of dollars to increase capacity. Similar promises have been made by governments throughout the world.
After ramping up its production of auto chips, TSMC, the world’s biggest contract chip manufacturer, indicated this week that it expects chip supply problems to ease in the coming months. Automobile manufacturers have said that they anticipate shortages to continue until next year.
Pat Gelsinger, while he was CEO of VMware, in 2017.
Patrick T. Fallon/Bloomberg News photo
Mr. Gelsinger, who was Intel’s chief technology officer before departing to head VMware Inc., VMW 0.29 percent, returned to the chip giant in February to take over as CEO after his predecessor, Bob Swan, caused significant delays in chip-making advancements.
Mr. Gelsinger has promised to make Intel’s chip production more dependable.
Intel, a serial dealmaker, agreed to sell its flash-memory manufacturing business to SK Hynix Inc. 000660 -2.02 percent of South Korea for $9 billion in October.
The acquisition of Altera Corp. for $15.4 billion in 2015 was its largest transaction to date. In 2017, it agreed to acquire Mobileye, a manufacturer of driver-assistance technologies headquartered in Israel, for approximately $14 billion.
As industry participants seek scale and extend their product portfolios to accommodate the growing number of daily objects that are linked to the internet, consolidation has spread across the semiconductor business.
Last year, Analog Devices Inc. ADI -1.50 percent paid more than $20 billion for Maxim Integrated Products Inc., MXIM -1.29 percent, and Nvidia paid $40 billion for Arm Holdings, a British chip designer funded by SoftBank Group Corp. 9984 -0.19% AMD subsequently agreed to pay $35 billion to acquire Xilinx Inc. XLNX -2.28 percent.
What Does the Global Chip Shortage Mean for You?
—This article was co-written by Robert Wall.
Dow Jones & Company, Inc. All Rights Reserved. Copyright 2021 Dow Jones & Company, Inc. 87990cbe856818d5eddac44c7b1cdeb8
Intel is in talks to buy GlobalFoundries for about $30 billion. The deal would create the world’s largest semiconductor company and give Intel a significant boost in its battle with AMD. Reference: intel news.
Frequently Asked Questions
Is Intel acquiring GlobalFoundries?
Intel is acquiring GlobalFoundries.
Who Is Intel trying to buy?
Intel is trying to buy Altera.
How much is GlobalFoundries worth?
GlobalFoundries is a company that designs and manufactures semiconductor chips. It was founded in 1989 and is headquartered in Santa Clara, California. The company has over 17,000 employees worldwide.