qualcomm is rumored to acquire intel, how feasible is it? why was "hegemon" acquired?
2024-10-01
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qualcomm is rumored to acquire intel, and all parties are paying close attention to the progress of the incident
this past weekend, the news that the american chip giant qualcomm planned to acquire intel, another chip giant that is currently in trouble, detonated the entire industry. the relevant news was first reported by the "wall street journal" last friday, and intel's stock price immediately experienced a rebound. as of the close of u.s. stocks last friday, it jumped 8%. the wall street journal stated that qualcomm has recently made an acquisition intention to intel. however, the financial times subsequently disclosed that qualcomm’s acquisition of intel was far from finalized, and qualcomm had never “formally” expressed information about the acquisition.
how feasible is the acquisition?
intel shares have fallen 50% since the start of the year, leaving the company grappling with risks from potential acquirers and threats from hostile shareholders.
multiple financial media reported that intel's current market value reaches us$93 billion. if qualcomm really acquires intel, the deal is expected to surpass microsoft's $69 billion acquisition of american game company activision blizzard and become the largest acquisition in the history of the technology industry. according to the financial times, sources revealed that intel is evaluating qualcomm’s acquisition intention with goldman sachs and morgan stanley. some sources also said that intel is indeed considering various asset sales options, and qualcomm ignited the idea of acquiring intel as a whole after considering acquiring several different assets under intel. qualcomm, which currently has a market value of us$188 billion, is said to be working with evercore investment bank to evaluate its next strategy against intel.
intel announced the postponement of factory construction, pictured at its site in magdeburg, germany.
analysis by the us axios news network believes that qualcomm's acquisition of intel will face huge challenges. first of all, mergers and acquisitions require huge amounts of capital, but qualcomm has not disclosed the source of merger and acquisition funds. however, the biggest challenge facing qualcomm’s acquisition of intel will come from antitrust regulators. in 2017, chip giant broadcom tried to acquire qualcomm, but then-u.s. president trump blocked the deal in 2018 on national security grounds. axios even predicted that once qualcomm officially launches the acquisition process of intel, this transaction will surely become the most important antitrust case on the desk of the new president who takes office after the us presidential election in november this year.
just as news of intel's possible acquisition was spreading, bloomberg quoted sources on the 22nd as saying that apollo global management has offered to invest in intel, and the investment scale may be as high as 5 billion us dollars. some media interpreted this move as a vote of confidence in intel's "turnaround."
how an “overlord” becomes a target of acquisition
although the rumors have not been confirmed, intel's predicament is real. intel was once the world's top chip company, but has gradually declined in recent years, especially in the era of artificial intelligence (ai), being left behind by nvidia.
reuters once revealed that intel had hoped to take the lead in the artificial intelligence competition, but voluntarily gave up the opportunity. sources broke the news that intel had been in contact with openai, which was just established and little-known at the time, seven years ago. the two parties had been negotiating for several months for intel to purchase 15% of openai's equity for us$1 billion in cash. intel ultimately decided to abandon the deal. an important reason was that then intel ceo swan believed that it would be difficult to bring artificial intelligence models to the market in the short term and that it would be difficult to receive a return on investment.
intel executives and industry experts said in interviews that it was intel's "strategic misfortune" to give up cooperation with openai, and a series of "strategic misfortunes" over the years also caused intel, a top company in the pc era, to struggle in the artificial intelligence era. . the wall street journal pointed out that intel had actually encountered some setbacks in chip manufacturing before the arrival of the artificial intelligence boom. competitor nvidia's chip technology is highly suitable for artificial intelligence needs, while intel's technology has been ignored.
in the second quarter of this year, intel suffered a huge loss of us$1.6 billion. in august, it launched large-scale layoffs. earlier this month, it was revealed that it had proposed a business restructuring plan in an attempt to save itself. a former intel board member told reuters that the measures taken by the company were not enough and came too late.
shock the industry
all parties are also paying close attention and studying in advance the impact of this potential merger on the industry. american business media fast company analyzed on the 21st that qualcomm, which currently specializes in mobile phone chips, needs to diversify its business. the acquisition of intel will immediately make it the largest pc and server processor manufacturer, and it will obtain chips that it has never had. manufacturing plant. because of this, taiwan is paying close attention to this potential acquisition.
however, taiwan's "economic daily" believes that even if qualcomm acquires intel, it will not recover the chip orders released to tsmc, because intel's technology and yield rate are far inferior to tsmc, so the acquisition will have little impact on tsmc. fast company also pointed out that although qualcomm’s acquisition of intel will form a large chip company, it will still be difficult for the two companies to technically challenge nvidia, the leader in artificial intelligence chips.
fast company said that in the context of the development of so-called "edge ai technology", qualcomm may see an opportunity to deploy artificial intelligence technology on local mobile devices to defeat nvidia, which does not have mobile artificial intelligence chip technology. intel has strong capabilities in the field of chip packaging, which may help qualcomm create more powerful mobile artificial intelligence chips. this may be the further consideration of qualcomm's acquisition of intel.
source: global network
