Intel Corporation is seeking a deal to acquire contract chipmaker GlobalFoundries Inc. for about $30 billion, The Wall Street Journal reported citing people with knowledge of the matter.
US-based GlobalFoundries is owned by Global Mubadala Investment, an investment unit of the Abu Dhabi government. The acquisition talks appear to be between Global Mubadala and Intel, the Journal said.
Such a deal would benefit Intel’s efforts to make more chips for other tech companies.
However, there is no guarantee that an agreement will be reached. If it crashes, GlobalFoundries The Journal said an initial public offering could be conducted in 2022.
GlobalFoundries, which accounts for 7% of all foundry revenue, is the number 4 foundry in the world, according to TrendForce.
Intel declined to comment, while GlobalFoundries and Mubadala did not immediately respond to Reuters’ request for comment.
Chip shortages are affecting industries around the world. The deal between Intel and GlobalFoundries could help Intel boost production at a time when demand is at its peak.
Intel, with a market value of about $225 billion, is one of the last in the chip industry to both design and manufacture its own semiconductors.
The California-based company is planning to start making semiconductors for car makers struggling to stay afloat because of severe shortages.
If the deal goes through, it will advance Intel’s $20 billion plan to build its new contract manufacturing unit.
Called Intel Foundry Services, the new unit aims to operate like other contract chipmakers and will produce chips designed by other companies, The Journal reported.
Meanwhile, Pat Gelsinger, Intel’s new chief executive officer, said many domestic and international commitments are being made.
GlobalFoundries was once owned by rival Intel Advanced Micro Devices. AMD split from GlobalFoundries in 2008, but the two companies maintain a relationship.
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