Intel is acquiring Tower Semiconductor for US$5.4 billion
Intel is acquiring Tower Semiconductor for US$5.4 billion
Intel has announced that it is acquiring Israeli company Tower Semiconductor for US$5.4 billion, part of the chipmaker's push to advance its IDM 2.0 strategy.
IDM 2.0 refers to Intel's efforts to expand its manufacturing capacity to serve customers globally and grow its use of external foundries. Under CEO Pat Gelsinger, Intel is focusing on modernising its factories and constructing new ones, both key to its goal of reclaiming its leading position in chip technology.
Gelsinger also wants to rebuild chip manufacturing capacity in the US and Europe. Last year, Intel announced plans to invest US$20 billion in two new factories in Arizona. It also announced Intel Foundry Services (IFS) in March 2021, a new business unit dedicated to making chips for external designers.
The Tower Semiconductor acquisition gives Intel new expertise to tap on and customers. Above all, it will give Intel's contract chip ambitions a boost, helping it compete against Taiwan's TSMC.
Tower has considerable expertise in specialty technologies, such as radio frequency (RF), power, silicon-germanium (SiGe) and industrial sensors, on top of extensive IP and electronic design automation (EDA) partnerships.
“Tower’s specialty technology portfolio, geographic reach, deep customer relationships and services-first operations will help scale Intel’s foundry services and advance our goal of becoming a major provider of foundry capacity globally,” said Gelsinger in an official statement.
The deal is expected to close within the next 12 months, pending shareholder and regulatory approval.
Source: Intel