Qualcomm reportedly wants to buy all of Intel, it would be a bigger acquisition than Microsoft-Blizzard

Qualcomm reportedly wants to buy all of Intel, it would be a bigger acquisition than Microsoft-Blizzard

We all know very well that companies Intel he hasn’t been doing very well lately. What may come as a surprise to many is that it’s not problematic consumer processors that are to blame. Although they have high consumption, not much success in the retail sphere and an affair with instability, they are the ones that keep Intel afloat and bring it the highest profit. Among others, the problem lies, for example, in the huge costs of producing Intel Foundry chips and the failure to use the significantly increased interest in AI, which literally shot Nvidia and which also significantly helped competitor AMD. Intel stagnated here. Not only that, he announced the layoff of 15% of the workforce, the sale of some divisions (part of Altera), the Intel Foundry department, or the suspension of dividend payments. The value of the company from the beginning of the year, when it was between 48-50 USD, fell momentarily below 19 USD, which means by more than 60%. Even now, at just under $22, it’s not much better, and it’s still more than a half-fall.

It seems that competing companies might want to take advantage of this. It has been rumored for some time that Qualcomm might be interested in buying parts of Intel. It was supposed to be the chip design division, i.e. the core of the company. Intel without processors, that would be very interesting and strange. In recent days, however, even more remarkable speculations have been multiplying, moreover, they are supposed to come from several sources, which increases the credibility a little more. According to these behind-the-scenes reports Qualcomm wants to buy all of Intel. One source claims that Qualcomm CEO Cristiano Amon is in talks to take over all of Intel, and another source says that Amon is actively considering and discussing various options for doing so. Some proposals and conversations with representatives of both companies should have already taken place, but no formal offer was yet to be made. At least that’s what another source claims.

However, such a takeover could encounter many obstacles. One of them is market regulators and antitrust authorities. Consider Microsoft’s takeover of Activision-Blizzard. That was a $69 billion deal, it dragged on for years because of the authorities. However, if an agreement between Qualcomm and Intel were to happen, the value would significantly exceed the above-mentioned takeover of Blizzard.

Intel’s market value today is 93 billion USD (for the record, AMD has 252 billion USD and Nvidia 2.85 trillion USD), however, it can be assumed that the target amount for the purchase of Intel would be much higher. The value of Intel’s assets itself is higher than the company’s stock value, which is only about 80% (0.8). Yes, that’s how dramatically Intel shares fell. Interestingly, Nvidia has this value around 49, so the value of the shares is almost 50 times higher than the assets that the company has. But this is also due to the fact that Nvidia is a “fab-less” company, i.e. without its own factories, which outsources their ownership to other companies such as TSMC. However, TSMC has this ratio of 7.6, which is almost 10 times higher than Intel. As for Qualcomm, its stock value is now 188 billion USD, so it is 2x against Intel.

The question is also what Qualcomm could actually buy Intel for. If the value of Intel’s assets is over 120 billion USD, then it will be interesting to see where Qualcomm wants to take the amount, which will probably be somewhere around this number (even if it should be at a lower market price, it will be a lot). It has approximately 13 billion USD at its disposal, its revenues are around 35 billion USD per year. Do you think this takeover will happen?

Source: www.svethardware.cz