Intel in talks to buy GlobalFoundries for US$30 billion as it looks to expand advanced chip manufacturing, report says

The talks do not appear to directly involve GlobalFoundries, which is owned by an Abu Dhabi sovereign wealth fund, WSJ reported
Intel is one of the last semiconductor companies that still designs and manufactures its own chips

Intel

Reuters

Published: 11:00am, 16 Jul 2021

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Intel Corp is in talks to buy semiconductor manufacturer GlobalFoundries Inc for about $30 billion, The Wall Street Journal reported on Thursday, citing people familiar with the matter.

Any deal talks don’t appear to include GlobalFoundries directly, as a spokesperson for the company told the Journal it was not in discussions with Intel, according to the report.

Talks come as a semiconductor shortage is hobbling industries around the globe. A deal could help Intel ramp up production of chips at a time demand is at its peak and the company is looking to start producing chips for car makers that have struggled to keep operations running due to severe shortages.

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Intel, one of the last companies in the semiconductor industry that both designs and manufactures its own chips, said earlier this year it would expand its advanced chip manufacturing capacity by spending as much as US$20 billion to invest in factories in the US.

Intel said it intended to open its factories to outside chip designers, as it competes with Taiwan Semiconductor Manufacturing Co (TSMC) and South Korea’s Samsung Electronics Co.

GlobalFoundries, which is owned by Abu Dhabi sovereign wealth fund Mubadala Investment Co, has a manufacturing footprint across the US, Europe and Asia.

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Mubadala is looking at a potential listing of GlobalFoundries later in the year, Reuters reported in June, citing sources familiar with the matter.

GlobalFoundries’ customers includes Advanced Micro Devices Inc, its parent company before it was spun off more than a decade earlier, a relationship that could spark antitrust questions about an Intel deal.

Intel declined to comment, while Mubadala and GlobalFoundries did not immediately respond to Reuters requests for comment.

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