Written by Archia Bajwa
A White House official told Reuters that the presidential administration, Donald Trump, may not support the American Intel chips factories run by a foreign entity.
The comment was in response to the Bloomberg report that TSMC Taiwan, the world's largest chip maker, was considering taking a controlling share in Intel factories at the request of Trump.
The White House official said the Trump administration supports foreign companies that invest and build in the United States, but it is not likely to support a foreign company working on Intel factories.
Earlier, Bloomberg reported that the Trump team raised the idea of a deal between the two companies in recent meetings with TSMC officials, and that they were acceptable, citing a person familiar with the matter.
The White House official did not immediately comment on whether the Trump team met companies and raised the idea of such a deal. The official did not immediately respond to the follow -up questions about whether TSMC could participate in Intel factories through a joint entity whose headquarters in the United States.
Such a deal, which is still unconfirmed, can throw a financial lifeline to Intel, which has fought to restore its lost glory because it failed to take advantage of the Amnesty International boom and pour billions of dollars to become a contracting chips company – a transformation that has not yet been achieved.
Intel shares were closed by 2.2 % on Friday, while the TSMC shares listed in the United States closed about 1 %.
It is unclear whether Intel is open to treatment, according to Bloomberg, and the arrangement may involve the presence of main American chips designers who take stock shares, along with support from the United States government. The report added that it means that the project will not be owned by a foreign company only.
Earlier in the week, the research company Bird published a note saying that Intel factories can revolve in a new entity, jointly owned by Intel and TSMC, as it helps TSMC engineers ensure that the factories are viable.
“Intel will benefit from the great relief in the cash flow, and it will focus on design solutions and platforms, while the vibrant FAB may finally attract the main companies to diversify to the geo -based geographical manufacturing mode,” Bird said in the note.
Such a deal will need deep concessions on both sides.
If TSMC accepts an arrangement to operate Intel factories, they will have to make major changes on American chip maker operations because each chips factory has distinctive ways and technologies for operating factories.
To run FABS from Intel, TSMC may also need to reveal some property techniques and operations for Intel employees.
For its part, Intel must give up the fact that its manufacturing operations will become a completely different entity.
The entire Intel TSMC factories, known as FABS, also raises questions about the main Intel strategy to manufacture the chips that designed it. Most of the chips are “Fables” – the use of external sources of TSMC, which provide great cost savings.
“If Intel goes down to this path, you focus on being the semiconductor design company. So you end up until it looks like a Broadcom, Marvel or AMD,” said Matthew Prisoner, a playbush secretities analyst, said.
TSMC and Intel refused to comment.
Customs tariff exemptions?
Intel is among the largest beneficiaries of the US batch to manufacture critical wild chips.
According to the previous administration, the US Department of Commerce said in November that it will put the final touches on government support worth $ 7.86 billion for Intel.
The company is among the few chips that desigate and manufacture semiconductors. TSMC is now the largest slide maker in the world, which includes an eight -fold market rating than Intel.
The Chipmaker customers include the Tayyani and AMD contract, which is the violent Intel competitor in computers and server markets.
“Ironics, enough, TSMC may search for some identification exemptions to achieve this and allow an effective and effective flow of equipment and materials,” said Michael Ashley Shulemann, chief investment official in Running Point Capital.
Trump cost his economy team on Thursday to reach plans for mutual definitions on each country that imposes taxes on American imports, which increases the chances of a global trade war.
The former CEO of Intel, Gilgringer, who was expelled last year, has set high forecasts in the field of manufacturing and artificial intelligence capabilities among the main customers but were short, lost or canceled.
Intel shares lost about 60 % of their value in the past year, as the intense capital offer to support manufacturing – a strategy defended by Geelsiner – has been in the company's cash flow and eventually reduced about 15 % of its operating power.
The success of the Chipmming 18A technology from Intel, scheduled for this year, is the key to manufacturing.
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