Intel said Monday it will sell a 51% stake in its programmable-chip unit Altera to private equity firm Silver Lake, marking a significant step in the chipmaker's broader effort to restructure its business and shed non-core assets. The deal values Altera at $8.75 billion-roughly half the $16.7 billion Intel paid to acquire the company in 2015-and is expected to close in the second half of 2025.
The Santa Clara, Calif.-based semiconductor company will retain a 49% ownership stake in Altera, allowing it to participate in the business's future growth while removing Altera's financial results from its consolidated statements. "Today's announcement reflects our commitment to sharpening our focus, lowering our expense structure and strengthening our balance sheet," Intel CEO Lip-Bu Tan said in a statement.
Shares of Intel rose 4.3% in early New York trading to $20.52. The stock remains down 46% over the past year.
Altera, which specializes in programmable logic devices used across data centers and telecom networks, is expected to operate as an independent entity under the leadership of Raghib Hussain, who joins from Marvell Technology Inc., where he served as president of products and technologies. Hussain will succeed Sandra Rivera as CEO on May 5.
Silver Lake, which manages over $100 billion in assets, described the investment as a bet on the next phase of semiconductor innovation. "This investment represents a once-in-a-generation opportunity to invest in a scale leader in advanced semiconductors," said Kenneth Hao, chairman and managing partner of Silver Lake. He added that Altera would focus on "emerging AI-driven markets such as edge computing and robotics."
The transaction comes as Intel looks to reverse years of underperformance, marked by missed opportunities in artificial intelligence and falling market share to rivals such as Nvidia. In 2024, Intel's board ousted former CEO Pat Gelsinger after his multi-year turnaround strategy failed to regain momentum.
Lip-Bu Tan, appointed CEO earlier this year, has said Intel will pursue spin-offs of units that no longer align with its core business. At a recent company event, Tan said Intel must replace lost engineering talent, refocus on custom semiconductor design, and rebuild its balance sheet to compete more effectively.
