Tower Semiconductor soars 50% on ~$5.4B acquisition by Intel
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Intel (NASDAQ:INTC) is acquiring Tower Semiconductor (NASDAQ:TSEM) for $53 per share in cash, representing a total enterprise value of ~$5.4B.
The acquisition advances Intelâs IDM 2.0 strategy as the company expands its manufacturing capacity, global footprint and technology portfolio to address industry demand.
Intel said the acquisition accelerates its path to becoming a major provider of foundry services and capacity globally.
The companies added that the complementary transaction brings together Intelâs leading-edge nodes and scale manufacturing with Tower Semiconductorâs specialty technologies and customer-first approach.
Intel intends for its Intel Foundry Services (IFS) and Tower to become a fully integrated foundry business.
âTowerâs specialty technology portfolio, geographic reach, deep customer relationships and services-first operations will help scale Intelâs foundry services and advance our goal of becoming a major provider of foundry capacity globally,â said Intel CEO Pat Gelsinger.
âThis deal will enable Intel to offer a compelling breadth of leading-edge nodes and differentiated specialty technologies on mature nodes â unlocking new opportunities for existing and future customers in an era of unprecedented demand for semiconductors," added Gelsinger.
IFS and Tower Semiconductor will run independently until deal closure; IFS will continue to be led by Randhir Thakur, president of IFS, and Tower will continue to be led by its CEO Russell Ellwanger during this time.
Intel intends to fund the acquisition with cash. The transaction is expected to be immediately accretive to Intelâs non-GAAP EPS.
The deal is approved by Intelâs and Towerâs boards of directors and is subject to certain regulatory approvals and customary closing conditions, including the approval of Towerâs stockholders.
The transaction is expected to close in nearly a year.
TSEM +49.92% premarket to $49.67
INTC +1.41% premarket to $48.25