Intel Rebuffs Arm Holdings’ Acquisition Inquiry
By Ian King
September 27, 2024 | 11:40 PM IST
Arm Holdings Plc recently approached Intel Corp. with an interest in acquiring its struggling product division, but Intel declined, according to a source familiar with the matter. Arm’s inquiry did not extend to Intel’s manufacturing operations. Intel has two main units: a product group for PC, server, and networking chips, and its manufacturing division.
Both companies declined to comment on the discussions. Upon market opening in New York on Friday, Intel’s shares surged by up to 3.1%.
Once the largest chipmaker globally, Intel has faced severe setbacks this year, delivering dismal earnings and announcing plans to cut 15,000 jobs. It has halted its dividend and scaled back expansion plans. As part of its turnaround strategy, Intel plans to split its product and manufacturing divisions to attract external investors and customers, potentially paving the way for a company split.
Arm, primarily owned by SoftBank Group, is expanding its focus from smartphone chip designs to PCs and servers, competing directly with Intel. Acquiring the Intel division could have boosted Arm’s market reach and product offerings. Arm’s valuation has soared to over $156 billion following its IPO, driven by AI spending growth. Meanwhile, Intel’s market value has plummeted to $102.3 billion.
Intel is exploring other opportunities, including a $5 billion investment proposal from Apollo Global Management, signaling confidence in CEO Pat Gelsinger. Additionally, Intel plans to sell part of its stake in Altera Corp., which it acquired in 2015, to private equity investors, aiming to spin off and publicize that venture. Meanwhile, speculation of a Qualcomm takeover has also buoyed Intel shares recently.
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Original Story https://www.business-standard.com/technology/tech-news/arm-holdings-is-rebuffed-by-intel-after-inquiring-about-buying-product-unit-124092701371_1.html
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