Is the lifeline of Intel will arrive in the form of her rival from the past Qualcomm ? According to a report by the Wall Street Journal from Friday night, it appears that Qualcomm, the chip company from San Diego that has taken over the Android smartphone processor market and is responsible for the central core processor of Samsung devices – has approached Intel with a purchase offer.
This is not the first time that the two have spoken: reports of conversations between the two have also been published in recent weeks and mentioned non-binding negotiations that did not mature to talk. There is a lot of sense in a merger between Intel’s development arm and Qualcomm – a company that does not produce chips. Qualcomm is currently considering competing with Intel with chips for the personal computer based on competing technology, the one provided by Aram British. Qualcomm is also thinking about expanding its operations to the server field as well – and it brings with it an advantage over Intel: processors that have proven themselves in operation at low electrical power – as required by the mobile phone – also for other applications such as running servers and artificial intelligence. It draws encouragement from a similar development carried out by Amazon before it.
The report immediately lowered the Qualcomm stock by about 3.5% even before trading closed. In total, since the beginning of the year, Qualcomm’s stock has risen by nearly 20%, and the company is currently trading at a value of 186 billion dollars. Intel’s stock previously jumped by about 12% at once, and is now about 7% higher than the share price at the beginning of the day – a trend that brings the company to be traded at a value of 95 billion dollars, half of Qualcomm’s value.
A foothold in the computer market
To what extent will a merger between the two affect the company’s centers in Israel? It can be assumed that Qualcomm will see the development center in Haifa, located a few hundred meters from it in the Matam Industrial Zone, as an important asset. The center in Haifa is responsible for some of the core activities of Intel chips for computers. Qualcomm also deals in communication chips and therefore will benefit from Intel’s development center in Petah Tikva that deals in the field Therefore, for the workers in Israel, it seems that a merger between the two players is considered optimal.
“Qualcomm is looking at acquiring Intel’s development arm, and such a purchase could help Qualcomm get a good foothold in the world of computers and also deepen its foothold in the world of server farms,” says Oral Levy, investment manager at the technology fund at Moore Mutual Funds. “We believe that it will be easier for Qualcomm to digest such a purchase than Broadcom, especially in light of the fact that the latter is still digesting the acquisition of the software giant VMware.”
According to the report, the deal is far from becoming a fait accompli and it is not yet known if Intel even agreed to it. Even if the two reach an agreement, such a deal will have to go through the approval of the American and Chinese regulators. Intel CEO Pat Gelsinger has decided to symbolically split the manufacturing division out and appoint a separate management for it, although it will remain subordinate to him at this stage. Intel’s investors have long been pushing for a split into two separate companies: one deals with chip development and the other with manufacturing, this from The fear of the potential customers such as Nvidia and AMD to produce in a company that competes with them in one arm and produces for them in its other arm.
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