Intel sells 51% of its stake in Altera… First restructuring since CEO Lip-Bu Tan took office

Half the Corporate Value from 10 Years Ago

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(San Francisco = Yonhap News) Correspondent Kim Tae-jong = The struggling American semiconductor company Intel announced on the 14th (local time) that it has sold a 51% stake in its subsidiary Altera.

Altera, acquired by Intel in 2015, is part of the programmable chip unit and has been sold to private equity firm Silver Lake for $4.46 billion (₩6.35 trillion).

In this transaction, Altera’s enterprise value was estimated at $8.75 billion, which is approximately half of the $16.7 billion when Intel acquired it in 2015.

The sale of Altera’s stake is the first restructuring move since CEO Lip-Bu Tan took office last month, aimed at streamlining the organization by disposing of non-core assets.

Intel has reportedly been pursuing the sale of Altera since last September.

CEO Tan stated, “This sale demonstrates our commitment to further refining our focus, reducing our cost structure, and enhancing our financial strength.”

Altera produces programmable chips used in various industries, from telecommunications to the military. Last year, it recorded $1.54 billion in revenue, accounting for only 3% of Intel’s total revenue, with an operating loss of $615 million.

The sale is expected to conclude in the second half of this year, after which Altera’s financial performance will be excluded from Intel’s financial statements.

Reuters reported that this sale will secure cash liquidity for Intel, offering significant relief in the financially pressured situation following substantial investments made under former CEO Pat Gelsinger to transition into foundry (semiconductor contract manufacturing).

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