Intel's $5.4 billion Tower Semiconductor acquisition might help the chipmaker solve the current SoC shortage. Intel and other giant chipset manufacturers are still having difficulties meeting consumers' demands.
SANTA CLARA, CA - APRIL 26: The Intel logo is displayed outside of the Intel headquarters on April 26, 2018 in Santa Clara, California. Intel will report first quarter earnings today after the closing bell.
With that, many products are affected. The American multinational tech firm now decided to expand its manufacturing footprint by purchasing the Israeli chipmaker Tower Semiconductor.
Intel was able to close the deal for $5.4 billion or $53 per share. This is a major acquisition for the U.S.-based tech manufacturer since Tower Semiconductor is well-known for producing quality SoCs for the automotive industry and other tech markets.
Intel's Tower Semiconductor Acquisition a Great Deal?
According to Forbes' latest report, the Tower Semiconductor acquisition of Intel came after the company announced its recent $20 billion investment in Ohio.
SANTA CLARA, CA - JANUARY 16: The Intel logo is displayed outside of the Intel headquarters on January 16, 2014 in Santa Clara, California. Intel will report fourth quarter earnings after the closing bell.
Also Read: Intel Launches $1 Billion Fund to Build a Foundry Innovation Ecosystem
Before Intel acquired the Israeli chipmaker, it first invested in two new chip-making factories in Ohia earlier this 2022.
Now, it made another massive purchase after acquiring Tower Semiconductor, which CEO Pat Gelsinger considers a great deal since the move perfectly fits Intel's vision.
"Tower's specialty technology portfolio, geographic reach, deep customer relationships, and services-first operations will help scale Intel's foundry services and advance our goal of becoming a major provider of foundry capacity globally," said the CEO via Tech Crunch's report.
Why Tower Semiconductor Acquisition is a Big Deal
Moor Insight & Strategies Principal Analyst, Patrick Moorhead, explained that the latest Tower Semiconductor acquisition could greatly benefit Intel in the long run.
He added that the purchase would allow the American SoC maker to produce the type of silicon it never could. This means that Intel can now create RF, sensors, power management SoCs, as well as silicon photonics.
Dylan Patel, a SemiAnalysis chief analyst, backed this, saying that the Tower Semiconductor acquisition is actually a smart move from the giant chipmaker.
Aside from these, Patel also believes that the Israeli SoC maker can help Intel boost its ability to manufacture extensible and flexible PDKs (production design kits).
Right now, it is still hard to tell if the latest decision of Intel can completely solve its ongoing chipset scarcity. Remember, Gelsinger claimed that the global chip shortage can last until 2023.
For more news updates about Intel and its upcoming activities, always keep your tabs open here at TechTimes.
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Written by: Griffin Davis
