Intel buys Israeli chip maker

Intel Corporation acquired Israeli Tower Semiconductor Ltd., as part of CEO Pat Gelsinger's efforts to acquire chip manufacturing businesses previously provided by subcontractors. approved the acquisition of the company for $5.4 billion. The company's board of directors approved the deal, which is expected to be completed within 12 months. Gelsinger, who took over the CEO position last year, aims to compete in this field with Taiwan Semiconductor Manufacturing Company, which produces chips for many companies around the world. Gelsinger aims to modernize its production facilities and build new factories as the company regains leadership in chip technologies. With the acquisition of Tower, Intel will gain new customers and expertise. The chip making industry requires experience in different types of chips and design. Gelsinger identifies the lack of stability as the reason why Intel has not been successful enough in this area before. Since its inception, Intel has only produced chips of its own design. Tower stands out as a company that produces power management chips, image sensors and many different types of semiconductors. According to data from Bloomberg, the company's customers include companies such as Analog Devices Incorporation and Broadcom Incorporation. Although it is seen as a positive move, compared to TSMC's annual sales of $56 billion, it is stated that Tower's $1.3 billion volume will be limited in terms of scale. Analysts predict that TSMC's sales will increase by 27 percent in 2022. The industry-leading firm generates 50 percent of industry revenues while producing chips for Intel's leading competitors, including Advanced Micro Devices Incorporation and Nvidia Corporation.

It was founded in 1990

The Tower firm was established in the early 1990s by the merger of several companies. The company also has a factory in Texas. The Tower deal is considered part of Gelsinger's plan to reintroduce Intel to a leading edge in chip manufacturing. The firm is also building new facilities in Europe and a $20 billion factory in Ohio, USA. While this spending wave is putting significant pressure on Intel's profit margins, it also raises concerns on the investor side. The company's returns were below the last quarter's analysis, revealing a disappointing outlook. However, Intel states that it is possible for profit margins to reach the historical peak in 5 years. It is stated that Gelsinger, who complains that a significant part of the production has shifted to Asia, continues to seek government support to establish new production facilities in the USA and Europe, as well as company resources. "This is a great investment cycle for us as a company," said the CEO, in an interview after the return reports last month, and added, "While it is true for Intel, it is a vital move for the industry and our country."