Intel share price gains over 10% after rivals TSMC, Broadcom eye potential split deals; stock up 18% YTD

Intel share price: Intel rose over 10 per cent on Tuesday, February 18, after a report over the weekend said rivals Taiwan Semiconductor Manufacturing Co (TSMC) and Broadcom were each eyeing potential deals that could break the chipmaking icon in two. Intel Corp. gained over 10 per cent over the potential split deal speculations. Bloomberg News reported TSMC discussed the idea of operating Intel’s US factories and owning a controlling stake in the venture.

According to Wall Street Journal, Broadcom, meanwhile, has held informal talks with advisers about making a bid for Intel’s chip-design and the marketing business. The reports gave fresh life to the idea of an Intel breakup — a topic of conjecture for investors and analysts since last year. Intel said that it is an open question whether it will split up its factory and product-development divisions.

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Intel share price today

Intel shares climbed as high as $26.24 in New York trading Tuesday, marking the biggest single-day increase since multiple trade sessions from October 27, 2023. The chipmaking major's stock was up 18 per cent year-to-date (YTD) through the end of last week, fueled by the split deal speculation. 

Bloomberg News also reported on Tuesday that Silver Lake Management is in exclusive talks to acquire a majority stake in Altera, Intel’s programmable chip unit. Even though the formal discussions have reached an advanced stage, the exact size of the stake sale has not been determined.

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Intel, once dominant in the chipmaking industry, has struggled to regain its technological edge and lost market share to rivals. It missed the shift to artificial intelligence (AI) accelerators, letting Nvidia take a commanding lead. Intel’s board ousted Chief Executive Officer (CEO) Pat Gelsinger after his comeback plan was slow, and it has been searching for a new leader.

Bloomberg reported last year that Broadcom assessed whether to pursue an Intel deal but did not move ahead with talks. Advisers continued to pitch ideas to Broadcom. The TSMC factory plan might help clear the way for a deal to buy the product-development unit, but neither scenario has advanced past the early stages. 

According to the report, though the presiding Trump administration officials raised the idea of the Taiwan-based TSMC deal in recent meetings, a White House official reportedly said last week that the US President would be unlikely to support a foreign entity operating Intel’s factories.

Also Read: TSMC to make world’s most advanced semiconductors in US, gets $6.6 billion subsidy

Intel was among the largest beneficiaries of the US push to onshore critical chip manufacturing led by former President Joe Biden's administration. The US Commerce Department said in November it was finalizing a $7.86 billion government subsidy for Intel. It is one of a few chipmakers that design and manufacture semiconductors. Intel's shares lost about 60 per cent of their value last year.