Intel Is in Talks to Buy GlobalFoundries for $30 Billion: Report

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Updated July 15, 2021 8:49 p.m. ET / Original July 15, 2021 8:48 p.m. ET

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Intel has a declaration chip-making cognition akin to GlobalFoundries.

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Semiconductor heavyweight Intel is successful talks to bargain declaration spot shaper GlobalFoundries for $30 billion, The Wall Street Journal reported precocious Thursday.

Intel (ticker: INTC) banal edged up 0.5% successful the extended session. Shares closed disconnected 1.3% to $55.81 successful regular trading; different spot stocks besides were down.

Intel declined to comment. GlobalFoundries, which was erstwhile owned by Intel rival Advanced Micro Devices, didn’t instantly respond to a petition for remark from Barron’s, but a spokeswoman told the Journal the institution isn’t presently successful discussions with Intel.

The U.S.-based GlobalFoundries is owned by Global Mubadala Investment, an concern limb of the Abu Dhabi government. The talks look to beryllium betwixt Intel and Global Mubadala, the Journal reported.

If the woody goes through, it would bolster Intel’s $20 cardinal plans to physique retired its caller declaration manufacturing unit. The caller unit, called Intel Foundry Services, aims to run arsenic different declaration spot manufacturers, and volition marque chips designed by different companies.

The acquisition, however, wouldn’t boost Intel’s presumption against rival Taiwan Semiconductor Manufacturing (TSM) for the astir precocious and analyzable processors, which marque up astir half of Taiwan Semi’s revenue.

Several years ago, GlobalFoundries abandoned plans to manufacture likewise precocious chips utilizing utmost ultraviolet lithography technology, oregon EUV. The exertion is truthful complex—and expensive—that adjacent Intel has had trouble perfecting fabrication. So far, lone Samsung Electronics and Taiwan Semi person demonstrated they tin efficiently marque chips utilizing EUV technology.

Today, GlobalFoundries uses older exertion to marque little precocious semiconductors, though the chips often person arsenic important uses. Similar to different semiconductor manufacturers, GlobalFoundries has said it is expanding its production, with a astir $4 cardinal committedness to a caller works it is gathering successful Singapore.

AMD spun retired GlobalFoundries successful 2008, but the 2 companies support ties. AMD has a multiyear woody to bargain astir $1.6 cardinal of silicon wafers from GlobalFoundries, according to signifier that AMD filed with the Securities and Exchange Commission.

If the woody falls apart, GlobalFoundries could proceed with an archetypal nationalist offering already planned for 2022.

Write to Max A. Cherney astatine max.cherney@barrons.com

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