Intel Sells 50% Stake in Irish Fab for $11 Billion

Intel, a global leader in semiconductor technology, has made a significant move by selling 49% of its Fab 34 facility in Leixlip, Ireland, to an equity fund. This strategic decision is part of Intel's broader plan to strengthen its position in chip process technology and manufacturing. Funds managed by Apollo will lead an $11 billion investment in a joint venture with Intel for Fab 34, following months of speculation and rumors.

Intel's Semiconductor Co-Investment Program (SCIP) has been instrumental in facilitating this deal, which marks the company's second major investment after Chandler, Arizona in 2022. The SCIP is a key component of Intel's Smart Capital strategy, aimed at providing the necessary financial resources to regain leadership in the semiconductor industry.

Fab 34 is a cutting-edge facility designed for Intel's 4 and 3 process technologies. With an initial investment of $18.4 billion, the 49% stake sold to Apollo for $11 billion reflects the facility's advanced capabilities and potential. This move comes in the wake of Intel's ongoing investments, such as the $20 billion Intel 18A fabs in Ohio and a $8 billion high-volume fab by VSMC in Singapore.

The joint venture with Apollo focuses solely on Fab 34, allowing Intel to reallocate resources to other areas of its business while continuing the development of the facility. Fab 34, which recently saw the introduction of extreme ultraviolet lithography (EUV) for high-volume manufacturing, plays a crucial role in Intel's production of 3nm and 4nm technologies.

David Zinsner, Intel's CFO, emphasized the importance of this partnership, stating, "Intel's agreement with Apollo gives us additional flexibility to execute our strategy as we invest to create the world's most resilient and sustainable semiconductor supply chain." This collaboration underscores Intel's commitment to meeting the growing demand for silicon and ensuring a robust semiconductor market in the coming years.