 |
The big get bigger. Intel has announced that it is acquiring Tower Semiconductor (formerly known as TowerJazz). Intel is purchasing the Israeli company for $53 per share, representing a total enterprise value of about $5.4 billion. The move furthers Intel’s IDM 2.0 strategy as it works to expand its’ ‘manufacturing capacity, global footprint and technology portfolio’ to deal with ‘unprecedented industry demand.’
‘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,’ said Pat Gelsinger, Intel CEO. ‘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.’
Intel announced its IDM 2.0 strategy nearly a year ago. The strategy requires manufacturing expansion and the Intel Foundry Services. Intel intends to become a major provider of foundry capacity in the United States and Europe to serve its massive global customer base. With Intel Foundry Services, Intel aims to have a standalone foundry business that can not only address the needs of Intel but also offer foundry services for other companies.
 |
Tower Semiconductor has extensive experience and expertise in specialty technologies, including radio frequency, power, CMOS image sensors, silicon-germanium and industrial sensors. Tower is also experienced with IP and electronic design automation partnerships. Intel states that Tower’s ‘established foundry footprint will provide broad coverage to both Intel and Tower’s customers globally.’ Further, Tower serves high-growth markets, including mobile, automotive and power. Tower’s foundry presence complements Intel’s, and the acquisition promises growth opportunities in Texas, Israel, Italy and Japan.
‘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,’ said Russell Ellwanger, Tower CEO. ‘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.’
Dr. Randhir Thakur, president of Intel Foundry Services, added, ‘We are thrilled to welcome the Tower team to Intel. Their decades of foundry experience, deep customer relationships and technology offerings will accelerate the growth of Intel Foundry Services. We are building Intel Foundry Services to be a customer-first technology innovator with the broadest range of IP, services and capacity. Tower and IFS together will provide a broad portfolio of foundry solutions at global scale to enable our customers’ ambitions.’
The acquisition comes on the heels of Intel’s recent announcement that it will expand manufacturing capacity in Arizona and New Mexico, plus Intel has plans to build a mega-site in Ohio. With the addition of Tower, Intel believes that it’s positioned to address a nearly $100 billion foundry market.
The transaction is expected to close in about a year and has been unanimously approved by Intel’s and Tower’s boards of directors, but it is subject to regulatory approval. Until the deal is closed, Intel Foundry Services (IFS) and Tower Semiconductor will operate independently and continue to be run by their respective leaders, Thakur and Ellwanger. Intel intends for IFS and Tower to become a fully integrated foundry business as soon as the deal closes.
Author:
This article comes from DP Review and can be read on the original site.
