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Post: Intel’s Tower Semiconductor acquisition fails, as China witholds OK



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Intel’s planned $5.4 billion acquisition of Israel-based Tower Semiconductor has fallen apart, as China reportedly failed to approve the deal in time to meet a deadline agreed upon by the two companies for the deal to close.

Intel said in a statement late Tuesday said that the two companies mutually agreed to terminate the deal “due to the inability to obtain in a timely manner the regulatory approvals required under the merger agreement.” The company added that it will pay an agreed-upon termination fee of $353 million to Tower.

The failed deal can be seen as a victim of the ongoing tech trade war between the US and China. Neither Intel nor Tower identified China as the regulatory holdout. But both companies have facilities in the country, which retains the right to approve mergers and acquisitions of companies that generate revenue from affiliates within its borders, and multiple media reports note that Intel has let it be understood that regulatory approval was extended by authorities except for Chinese regulators.   

The deal, which was first announced in February 2022, saw its timeline extended at least two times before Intel decided to walk away from it.

The Tower acquisition, according to Intel, was part of its Integrated Device Manufacturing (IDM) 2.0 strategy, aimed at garnering more share of the foundry services market.

Intel had planned to take advantage of Tower’s expertise in radio frequency (RF), power, silicon-germanium (SiGe) and industrial sensor technologies, as well as its extensive IP and electronic design automation (EDA) partnerships.

Copyright © 2023 IDG Communications, Inc.

Lora Helmin

Lora Helmin

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