Semiconductor and software company Qualcomm is reportedly interested in buying the struggling chipmaker Intel.
According to a recent report by The Wall Street Journal, Qualcomm approached its rival in recent days with a takeover bid. It is still unclear whether Intel will consider the offer, which is described as “formal.”
Also, Reuters reports that Qualcomm CEO Cristiano Amon is “personally involved” in the process, which isn’t surprising considering the magnitude of the deal.
Qualcomm, which is the biggest chip provider for the smartphone industry, previously explored the possibility of acquiring part of Intel’s business, mainly its PC design unit. However, it appears that the company’s appetites have grown and that it has decided a complete acquisition would be a better strategy.
Once a leader in the semiconductor and computer components industry, Intel has been going through a rough time recently. One of the main reasons for the company’s struggles has been its inability to adapt to a changing market that is more geared towards the rising artificial intelligence sector.
Intel has been recently trying to improve its situation by considering several strategies that included splitting its chip designing and chip manufacturing business. A potential sale of its foundry unit has also been suggested.
Even if Intel accepts Qualcomm’s offer, the deal would likely have to navigate a number of obstacles and face an uphill battle to get approval from U.S. regulators.
Upon report, Intel’s shares have surged by more than 3% to close at $21.84 per share on Friday. The stock is currently 54.31% down year-to-date, with the company’s market cap dwindling to $93 billion.
Qualcomm, which has a market cap of $188 billion, saw its stock drop to 2.87% for a close price of $168.92 per share. Its shares are 20.46% up year-to-date.