Did TSMC and Broadcom "split" from Intel?

Once a chip giant, Intel is rumored to be facing acquisition talks, this time with Qualcomm and Taiwan Semiconductor.

According to reports from The Wall Street Journal and other media outlets, Taiwan Semiconductor and Broadcom are both considering potential deals with Intel. Sources familiar with the matter revealed that Taiwan Semiconductor has been exploring the possibility of controlling part or all of Intel's chip factories, potentially as part of an investor consortium or other structure.

Broadcom has been closely monitoring Intel's chip design and marketing business and has already engaged in informal discussions with Intel's advisors, with plans to make an acquisition offer once a manufacturing partner is found.

Since this week, as speculation about a potential collaboration between Taiwan Semiconductor and Intel has spread, Intel's stock price has surged, with a cumulative increase of over 23%.

U.S. Government's Stance May Pose Potential Obstacles to Acquisition

According to regulations, any transaction involving Taiwan Semiconductor and other investors controlling Intel's factories must receive approval from the U.S. government.

The CHIPS Act, passed in 2022, established a $53 billion domestic chip manufacturing subsidy program, of which Intel is the largest beneficiary, receiving up to $7.9 billion to support its factory construction in Ohio, Arizona, and other regions. Under the agreement, if Intel spins off its factories into a new entity, it must maintain majority ownership of the factories.

Reportedly citing informed sources, the Trump administration requested Taiwan Semiconductor to explore the idea of taking over Intel's factories. Meanwhile, a White House official told the media that the president is unlikely to support transactions involving foreign entities operating Intel's factories.

In addition to the agreement's stipulations, acquisition deals concerning Intel also face operational complexities. Analysts indicate that Intel's factories were primarily established for the production of Intel chips, and the company has only begun to attempt to manufacture chips for external customers in recent years.

This means that transforming Intel's factories to produce advanced chips in the manner of Taiwan Semiconductor would be a significant and costly engineering challenge.

There are also views suggesting that, given the Trump administration's restrictive stance on immigration, it may limit other companies from deploying engineers to the U.S. to oversee production.

Intel's decline began when it fell behind Taiwan Semiconductor in advanced process technology, suffering from competition from rivals that adopted Taiwan Semiconductor's foundry chips.

Over the past year, Intel has attracted the interest of acquirers, and this interest has intensified since the company's former CEO Pat Gelsinger stepped down last December.

To address its challenges, Intel has begun to separate its chip manufacturing division from other parts of the company, with some analysts viewing this as a precursor to a series of spin-offs. Additionally, in recent years, Intel has been advancing cost-cutting plans, divesting many businesses, and is in the process of selling its stake in its programmable chip division, Altera According to reports from multiple media outlets, Intel's interim executive chairman Frank Yeary has been in discussions with potential acquirers and officials from the Trump administration. Yeary has expressed to those around him that his primary focus is on maximizing value for Intel shareholders