Arm Attempt to Acquire Intel Product Division Rejected

According to sources familiar with the matter, Arm has approached Intel to discuss the potential acquisition of its struggling product division but was informed that this business is not for sale. Notably, during these high-level discussions, Arm did not indicate interest in Intel's manufacturing operations, which comprise two main divisions: one focused on chips for personal computers, servers, and networking devices, and another managing its manufacturing facilities.

Both Arm and Intel representatives declined to comment on the discussions.

Once the largest chip manufacturer globally, Intel has become the subject of acquisition speculation due to a rapid decline in business this year. The company released a disastrous earnings report in August, resulting in one of its most significant stock price drops in decades, alongside a workforce reduction of 15,000 employees to cut costs. Furthermore, Intel has scaled back its factory expansion plans and suspended dividend payments.

As part of its efforts to recover, Intel is separating its chip product division from its manufacturing business, aiming to attract external customers and investors while laying the groundwork for a possible company split.

Arm, primarily owned by SoftBank, generates most of its revenue from smartphone chip designs. CEO Rene Haas is actively seeking to expand the company's influence beyond its traditional market. A merger with Intel could enhance Arm's presence and facilitate a shift towards selling more of its proprietary products.

While Arm's revenue represents only a fraction of Intel's, its valuation has surged since its initial public offering last year, now exceeding $156 billion. In contrast, Intel has seen its market value halved this year, currently standing at $102.3 billion.