Qualcomm to Acquire Intel, Broadcom Also Evaluating

Sources have revealed that Qualcomm has approached Intel with a potential acquisition offer, which could mark one of the most significant and far-reaching deals in recent years. Media outlets have confirmed that Qualcomm has recently engaged Intel in discussions regarding a potential acquisition. However, according to insiders, it is still unclear if formal negotiations have begun or what specific terms are on the table.

If the deal proceeds, it could become one of the largest mergers in the technology sector's history. Intel, currently valued at around $90 billion, faces one of the most severe crises in its 50-year history. Despite this, industry experts warn that the acquisition is far from certain. Even if Intel agrees, such a large-scale transaction would likely face intense antitrust scrutiny, though some view it as a potential opportunity to bolster the U.S. chip industry's competitive edge. Qualcomm may consider selling parts of Intel's assets to other buyers to complete the deal.

Intel was once the highest-valued chip company globally, but its stock has fallen by approximately 60% this year. Back in 2020, the company had a market value of over $290 billion. Following news of the acquisition talks, Intel’s stock closed more than 3% higher on Friday. In contrast, Qualcomm, with a market capitalization of about $185 billion, saw its stock dip by roughly 3%, though it has risen around 17% year-to-date.

There have been earlier reports suggesting Qualcomm was exploring the possibility of acquiring certain aspects of Intel's design business, particularly its PC design division.

Meanwhile, Broadcom has also reportedly been evaluating a potential acquisition of Intel, according to insider information cited by Bloomberg. While Broadcom previously considered acquiring Intel, it has yet to formally pursue such an offer. Advisors are said to be continuously evaluating the prospects for Broadcom.

Broadcom has declined to comment on these rumors.

Broadcom's semiconductor business is projected to generate less than $30 billion in revenue for fiscal year 2024, significantly lower than Intel's estimated $60 billion annual revenue in recent years. Analysts suggest that Broadcom might view acquiring Intel as a strategy to enhance its own semiconductor operations. If successful, the combined company could reach a market valuation exceeding $1 trillion.

As a fabless company, Broadcom currently relies heavily on external manufacturing, particularly through TSMC, incurring costs that could reach $7 to $8 billion annually. Acquiring Intel's manufacturing capabilities could reduce these costs, assuming Intel's manufacturing reforms succeed.

However, experts agree that any acquisition attempt by Qualcomm or Broadcom is likely to face significant antitrust hurdles.