Intel urged to explore the possibility of disjoint development and manufacturing of chips

Intel’s investor activist Third Point LLC hedge fund is pushing management to explore “strategic alternatives.” Among them – the opportunity to follow the path of AMD, separating the development and production of microcircuits. This information is contained in a letter sent by the general director of the fund to the chairman of the board of directors of Intel and which was at the disposal of Reuters, which devoted exclusive material to this topic.

There is no official data on this, but it is believed that the Third Point LLC fund owns Intel shares in the amount of about $ 1 billion. By the way, after the information about the letter appeared, Intel shares rose by 6.1%, so that the company’s market value exceeded $ 200 billion. In total, its shares have fallen by about 21% this year.

The letter says that Intel has ceded its leading positions in chip manufacturing to TSMC and Samsung Electronics, while AMD is pushing it out in the PC and server processor market. In addition, Intel is largely unrepresented in the Nvidia-dominated AI market. The letter also calls for immediate action to strengthen Intel’s position as a major supplier of PC and server processors.

“Without immediate changes at Intel, we fear America’s access to advanced semiconductor supplies will be undermined, forcing the US to rely more heavily on geopolitically volatile East Asia to power everything from PCs to data centers, critical infrastructure, and more.” – said in the document.

If the Third Point ideas gain support, Intel will face major changes, including the cancellation of certain acquisitions, such as the $ 16.7 billion purchase of programmable logic arrays manufacturer Altera in 2015.

So far, Intel has responded with a short statement:

“Intel welcomes all investors to contribute to shareholder value. In that spirit, we look forward to talking to Third Point LLC on their ideas for achieving this goal.”

(Via)