According to people familiar with the matter, Intel is exploring the acquisition of GlobalFoundries Inc. This move will promote the semiconductor giant’s plan to produce more chips for other technology companies and was named the largest acquisition in history. This transaction may give GlobalFoundries a valuation of approximately US$30 billion. There is no guarantee that someone will come together and GlobalFoundries can proceed with the planned initial public offering.
None of the negotiations seem to include GlobalFoundries executives, because a spokeswoman for the company said it did not discuss with Intel. Intel’s new CEO Pat Gelsinger said in March that the company will vigorously promote to become other chip manufacturers, a market dominated by TSMC. The talks were held in a situation where semiconductor shortages are hindering various industries around the world. The deal can help Intel increase chip production when demand peaks, and the company is seeking to start producing chips for automakers that are struggling to maintain operations due to severe shortages.
Intel, which is one of the last companies in the semiconductor industry to design and manufacture its own chips at the same time, said earlier this year that it would invest up to 20 billion U.S. dollars in US factories to expand its advanced chip manufacturing capabilities. Intel said it intends to open its factories to external chip designers because it competes with Taiwan Semiconductor Manufacturing Co. and South Korea’s Samsung Electronics Co., Ltd. GlobalFoundries is owned by Mubadala Investment Company, Abu Dhabi’s sovereign wealth fund, with manufacturing operations in the United States, Europe and Asia.
Reuters reported in June, citing sources familiar with the matter, that Mubadala is considering listing GlobalFoundries later this year. GlobalFoundries’ customers include its parent company, Advanced Micro Devices Inc (AMD), and this relationship could raise antitrust issues regarding Intel transactions before the company was spun off more than a decade ago.
