Intel wants to diversify, gain skills and production capacity as part of its openness to outside chip orders. To do this, the group has just signed the takeover of the Israeli Tower Semiconductor for 5.4 billion dollars.
Intel has just formalized the acquisition of the Israeli Tower Semiconductor for 5.4 billion dollars // Source: Ryan – Unsplash
It’s official, Intel has acquired Israeli chipmaker Tower Semiconductor. This takeover, made official today by Intel, had been rumored by the wall street journalwhose information was quickly relayed by the specialized site Engadget. One of the aims of the Tower Semiconductor acquisition is to boost the independent foundry business that Intel has engaged in under the Intel Foundry Services division.
In March 2021, in the midst of a global shortage of semiconductors (a shortage that could begin to diminish), Intel announced that it would open its foundries to orders for external chips. The acquisition of Tower Semiconductor, precisely specialized in the manufacture of chips, is part of this new strategy. This takeover should enable Intel to increase its semiconductor production capacities… while reaching a wider range of customers.
Tower Semiconductor an Israeli colossus
Valued at author of 3.6 billion dollars, Tower Semiconductor is rather well positioned on the semiconductor market. The firm manufactures different types of chips for customers from various sectors (automotive manufacturers, manufacturers of medical devices, manufacturers of industrial equipment, etc.). It also has operations in Israel, Italy, the United States and Japan, where it manufactures chips from 150, 200 and 300 mm wafers.
Still, the Israeli manufacturer does not rely on state-of-the-art engraving processes. Its official site, for example, mentions an engraving fineness ranging from 45 to 65 nm. As a reminder, Intel currently uses a 10 nm engraving protocol, while TSMC, the world’s leading independent founder, uses the node 4nm.
It is therefore not at Tower Semiconductor that Intel would plan to engrave future Qualcomm chips, for example, but the Israeli group’s customers do not require a high degree of engraving precision for their orders: above all they are looking for regular production, reliable and in large volumes.
When Intel lengthens the tickets…
As pointed out Engadget, this is not the first time we have heard of a takeover of this type for Intel. Last summer, the American giant would have sought to acquire GlobalFoundries for some 30 billion. The former founder of AMD had nevertheless preferred to opt for an IPO, thus leaving Intel’s projects to fall through.
Remember that Intel is also investing massively in the extension of its own production capacities. The firm has for example launched the construction of two semiconductor factories in Arizona for 20 billion dollars. A few months later, Intel also announced another factory project, this time in Ohio… and with a clearly stated ambition: to make it “the largest semiconductor manufacturing site on the planet“.
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