Intel Corp has decided to abandon its efforts to acquire Tower Semiconductor Ltd. after failing to acquire regulatory approval in time. The $5.4 billion deal was agreed upon in February 2022. The Israeli company also confirmed that the acquisition had been called off.
The purchase of Tower was a central component of Intel CEO Pat Gelsinger’s plan to get a foothold in a faster-growing part of the semiconductor industry. Still, Gelsinger refuses to abandon the possibility of working with Tower, stating that “we will continue to look for opportunities to work together” following the breakdown of the agreement.
Dominated by Taiwanese companies, the foundry segment of the semiconductor industry is where Tower finds itself. Despite its small market share, the Israeli company has the expertise and a customer base that Intel lacks. Initially, the acquisition was expected to take 12 months to roll out, however, the failure to get Chinese approval all but buried the deal which had already encountered multiple hurdles. Intel will pay Tower a $353 million termination fee.