Intel sells the Altera chip unit to the PE group Silver Lake

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Intel has agreed to sell his altera chip unit to the private equity group Silver Lake, while the semiconductor Pioneer works to collect cash and to make competitors such as Nvidia in the production of chips for use in artificial intelligence.

Silver Lake will buy a share of 51 percent to Altera, which produces programmable chips that can adapt technical and industrial companies to their AI needs to evaluate $ 8.75 billion, said Intel on Monday.

Intel, which has been in discussions about the sale of the unit in the context of a wider plan for the sale of non-core assets, will continue to have a share of 49 percent.

At the beginning of this year, Intel concluded exclusive negotiations with Silver Lake, after it has been decided that the private equity group had a functional plan for a gymnasium from Altera, which would increase its value and determine the stage for a possible public list of the business.

Ken Hao, Silver Lake’s Chair, led the deal of the Buyout group and is considered one of the most knowledgeable investors in the private equity industry in semiconductors. Two decades ago, Hao helped to create its predecessor to today’s chipgiant Broadcom by cutting out a semiconductor business from Hewlett-Packard.

The Silver Lake has concentrated on great takeovers in recent years, including the promotion of companies that are owned by technology conglomerate. In March 2023, it deployed a deal for the purchase of Qualtrics of the software group from the German conglomerate SAP for USD 12.5 billion. This deal was negotiated from Altera, as its majority purchase, since the broader financial markets were brewed with volatility.

“This is the typical investment of Silver Lake,” said Hao of the Financial Times in an interview. “It includes a high degree of complexity with an important industrial partner, and there is a lot of confidence in our ability to create added value.”

Intel acquired Altera in 2015 for around $ 17 billion. The Chip Company previously announced that a sales sale would increase the value of the chipmaker and determine the stage for a complete exit.

The Silver Lake points out that the programmable chips from Altera, which are mainly produced by Intel, will benefit from increasing use of defense, health and industrial companies that use AI technologies for their products.

As part of the wealth sale, Altera will replace its current chief Sandra Rivera with Raghib Hussain, a co -founder of the Semiconductor Company Cavium.

Intel quickly works to submit non-core assets and improve its finances in order to invest billions from dollars in modern chip manufacturing systems in the United States and in Europe. In January it announced the spin -off of his risk capital arm Intel Capital.

“Today’s announcement reflects our commitment to sharpen our focus, reduce our cost structure and strengthen our balance sheet,” said Lip Bu Tan, managing director of Intel, the role last month.

The sales sale is part of a broader planned restructuring that occurs, since President Donald Trump gives up for opportunities to revive the assets of Intel, one of the architects of modern Silicon Valley.

Intel talks to the administration about a partnership with the industry leader Taiwan Semiconductor Manufacturing Company, the FT reported before.

The company started a great cost reduction last summer, set up thousands of jobs and stopped the production projects in Europe because its business with chip “Foundry” was loss of several million dollar losses.

In December, the board of Intel, the managing director of Pat Gelsinger, did not swell quickly enough in relation to the concern of the chipmaker to catch up with rivals such as Nvidia and AMD. The experienced investor and former Cadence Managing Director Tan, Tan, took on the role last month.

Washington’s financial problems alerted Washington because Intel is the only US chip maker who can produce high-end chips.

Additional reporting by Michael Acton in San Francisco