Intel Corp. (Nasdaq: INTC) today announced the signing of a definitive agreement to acquire Israeli chipmaker Tower Semiconductor Ltd. (Nasdaq: TSEM; TASE:TSEM). Intel said it will acquire Tower for $53 per share in cash, a 60% premium on Tower's closing price on Wall Street yesterday evening. Intel will pay an overall $5.8 billion for Tower, including the company's $400 million in cash. Tower's share price is currently up 41.76% on the Tel Aviv Stock Exchange.
Intel said that the acquisition of the Israeli foundry for analog semiconductors in Migdal Ha'Emek advances its IDM 2.0 strategy, as the company expands its manufacturing capacity, and technology portfolio to address unprecedented industry demand.
Intel CEO Pat Gelsinger said, "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. This deal will enable Intel to offer a compelling breadth of leading-edge nodes and differentiated specialty technologies on mature nodes - unlocking new opportunities for existing and future customers in an era of unprecedented demand for semiconductors."
Tower CEO Russell Ellwanger added, "With a rich history, Tower has built an incredible range of specialty analog foundry solutions based upon deep customer partnerships, with worldwide manufacturing capabilities. I could not be prouder of the company and of our talented and dedicated employees. Together with Intel, we will drive new and meaningful growth opportunities and offer even greater value to our customers through a full suite of technology solutions and nodes and a greatly expanded global manufacturing footprint. We look forward to being an integral part of Intel’s foundry offering."
Intel said that the transaction, which is expected to close in 12 months, was expected to be immediately accretive to Intel’s non-GAAP EPS. Intel intends to fund the acquisition with cash from the balance sheet.
The company said that Intel Foundry Services, which was established last March, and Tower Semiconductor will run independently until deal closure, after which, Intel’s intent is for the two organizations to become a fully integrated foundry business.
Published by Globes, Israel business news - en.globes.co.il - on February 15, 2022.
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