After more than 12 months, Intel said the planned acquisition of Israel-based Tower Semiconductor might be delayed again and is expected to be completed by the first half of 2023.
Bloomberg quoted Intel's emailed statement saying that while the company continues to work to close the Tower transaction in the first quarter of 2023, the transaction may close in the year's first half, subject to certain regulatory approvals and customary closing conditions. Bloomberg reported that a regulatory review by China might be the primary hurdle for the deal to be completed.
Intel proposed to acquire Tower Semiconductor in mid-February of 2022 and previously expected to complete the deal in about 12 months. In October, Intel said in the earnings call that it expected the deal to be completed in the first quarter of 2023.
Under the 'IDM 2.0' strategy announced in March 2021, Intel aims to scale up its manufacturing capabilities through both internal and external foundries, as well as launching the Intel Foundry Services business division. According to Intel's financial statements, with USD895 million, Intel Foundry Services accounted for 1.42% of Intel's total sales. Meanwhile, the business division has been posting operating losses since its forming, except for the quarter that ended in December 2021. Intel has just appointed Stuart Pann to oversee the business division.
Tower Semiconductor, with its 45-65nm manufacturing capability for analog chips, can complement Intel's roadmap for its foundry service, including getting loyal customers, generating a stable revenue stream, acquiring a host of mature process technologies, and gaining a team of seasoned executives experienced in contract chipmaking, Tom's Hardware reports.
Meanwhile, India's government is still waiting for the deal's completion before considering approving the application by ISMC, a consortium formed by Abu-Dhabi's Next Orbit Ventures and Tower Semiconductor, to set up a 65-nm wafer fab for analog chips. ISMC plans to establish its wafer fab in India's southern state of Karnataka.
