Intel Reportedly in Advanced Talks to Sell Altera to Silver Lake

[Nomad76]

A Bloomberg report said Silver Lake Management, a large private equity firm, has begun exclusive talks to buy a controlling stake in Intel's Altera division. Altera focuses on versatile chips that are widely used in telecommunications networks. The size of the stake is still being worked out, but negotiations have moved forward, people familiar with the deal said, speaking on condition of anonymity. They caution that things could slow down or the deal might not happen. When asked, people speaking for Intel and Silver Lake did not comment.

The news jolted the market, sending Intel shares up as much as 17% on Tuesday, Feb. 18, 2025, marking their biggest single-day gain in nearly five years. The surge was driven in part by separate speculation about a potential spinoff involving Taiwan Semiconductor Manufacturing Co (TSMC). By late afternoon trading in New York, Intel shares were up 15%, valuing the company at about $117 billion. If the sale goes through, it would mark a major shift for Intel as it tries to reshape its business. While there is no information on the size of the deal, last November Lattice Semiconductor Corp. and a group of buyout firms expressed interest in Altera. Some insiders said that potential buyers valued Altera at just $9 billion, a big drop for Intel, which bought Altera in 2015 for about $17 billion. Intel faces continued challenges following Gelsinger's departure, as the company searches for both a new CEO and a replacement for its Data Center and AI division head, who recently left to become Nokia's chief executive.



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[Sound_Card]

Intel's strat seems to be: let's lease out every division of our company and turn it into a collective commune of corporations that utilize its IP portfolio.

 

[Daven]

The dissolution of Intel is going to be slow and painful to watch. While the powers that be are the cause, nothing will improve the situation. This part of capitalism, ‘too big to fail’, is the worst.

 

[Denver]

There won't be much left if it continues like this.

Fabs and dGPUs are the next money-losing business, bound to be sold off or shut down.

 

[Assimilator]

One of the causes of Intel's current malaise is their attempt to diversify into anything that needs a CPU, during the course of which they ironically forgot how to do a good job at the thing that made them what they are: CPUs. Dumping attention-distracting subsidiaries like Altera would allow them to refocus on that critical facet.

And let's be honest here, if Altera is only worth $9bn after Intel paid nearly double that a decade ago, then they have run that company straight into the ground and should let someone else take it over and manage it properly. Telecoms is basically a money printer, it takes McDonnell-Douglas level skills to screw that type of business up.