TSMC and Broadcom Consider Intel Carve-Up Deals

Reports of Potential Deals to Split Intel

Recent reports have emerged suggesting that Taiwan Semiconductor Manufacturing Co. (TSMC) and Broadcom are separately considering deals to divide Intel, the struggling chip giant, into its manufacturing and design segments. This development comes at a time when Intel is facing challenges in the semiconductor market.

TSMC's Interest in Intel's Manufacturing Operations

TSMC is reportedly contemplating taking over Intel's manufacturing operations, a move that has been encouraged by the White House administration under President Trump. According to a Bloomberg report citing an unnamed source, the White House officials have discussed the possibility of a chip manufacturing deal with TSMC. This aligns with the administration's efforts to strengthen American manufacturing capabilities. TSMC's potential acquisition of some or all of Intel's chip factories could be structured as a joint venture or part of an industry consortium involving US foundry customers like Apple and Nvidia. However, Intel's stance on this proposed deal remains uncertain.

Broadcom's Consideration of Intel's Chip Product Business

On the other hand, Broadcom, headquartered in the US, has informally explored the option of bidding for Intel's chip product business. The Wall Street Journal reported that Broadcom has discussed this possibility with financial advisors, but the company would only proceed if it secures a partner to manage Intel's manufacturing segment. As a leading provider of semiconductor, enterprise software, and security solutions, Broadcom is well-positioned for the AI era with its offerings in networking and AI integration chips. It currently holds the second position among semiconductor companies based on market capitalization.

Independent Actions of Broadcom and TSMC

While both Broadcom and TSMC are reportedly considering deals related to Intel, they are not collaborating on the potential split, as per the WSJ. Despite this, the strategies of the two companies could complement each other in reshaping Intel's structure and operations.

Challenges and Regulatory Hurdles Ahead

Any transactions involving the division of Intel would likely face regulatory scrutiny and various challenges. The competitive semiconductor market poses significant obstacles for Intel as it strives to regain its competitive edge. These discussions underscore Intel's vulnerability and the evolving landscape of the semiconductor industry.