Intel may follow AMD's Lisa Su by spinning off its foundry business to GlobalFoundries, creating a US-based chipmaking powerhouse, says a former TSMC executive.
In a pivotal moment for Intel, the company announced on March 12, 2025, that Lip-Bu Tan, a seasoned semiconductor industry leader, will assume the role of CEO effective March 18. Intel's independent chair of the board, Frank Yeary, expressed confidence in Tan's ability to steer the company toward its goal of becoming a "world-class products company and a world-class foundry."
However, the industry is abuzz with speculation about Intel's strategic direction, particularly regarding its foundry business, Intel Foundry Services (IFS). Reports surfaced yesterday that negotiations continue regarding a potential joint venture for Intel's foundry division, with TSMC exploring partnerships with major chip design firms, including Nvidia, AMD, Qualcomm, and Broadcom.
This raises a critical question: Will Intel continue to operate as an integrated device manufacturer (IDM) under Tan's leadership, or will it spin off its foundry business to focus on chip design and innovation?
To gain deeper insights into what Tan's appointment means for Intel, I spoke with M.S. Lin, a former high-ranking executive of TSMC and a veteran of the semiconductor industry with ties to Lip-bu Tan through Walden International, Tan's influential venture capital firm. Lin offered a bold perspective on how Tan could revive Intel's foundry business and reshape the global semiconductor landscape.
Playbook inspired by AMD's Lisa Su
Lin believes that Lip-Bu Tan's best course of action to revitalize Intel's foundry business is to emulate the successful strategy of AMD CEO Lisa Su. "Tan should consider merging Intel Foundry Services (IFS) with GlobalFoundries," Lin emphasized. "This would allow Intel to focus on designing and developing its own chip products while fostering a strong, US-based foundry to directly compete with TSMC in the US"
According to Lin, this move would be a game-changer for the industry. "The biggest benefit is that the US would have its own homegrown foundry powerhouse to rival TSMC, which is critical for both industry competition and national security," he explained. "This is also the best strategy for the U.S. to rebuild its semiconductor manufacturing capabilities."
Lin highlighted that GlobalFoundries, originally spun off from AMD, has already consolidated much of the U.S.-based foundry capacity, including AMD and IBM factories. A merger with Intel's foundry division could create a formidable player capable of challenging TSMC's dominance while allowing Intel to streamline its focus on its core strength—chip design and innovation.
The M&A expertise of Lip-bu Tan and Broadcom's Hock Tan
Lin pointed out that Tan's extensive experience in mergers and acquisitions (M&A) positions him uniquely to execute such a strategy. "Lip-Bu Tan and Broadcom CEO Hock Tan, both Malaysian-born semiconductor veterans, are highly skilled in M&A," Lin noted. "Tan's greatest influence stems from Walden International, his venture capital firm, which has investments in many major semiconductor companies in China and Taiwan."
Lin speculated that Tan's appointment might even hint at a behind-the-scenes collaboration with Hock Tan. "Hock Tan, through Avago, has already consolidated American chip divisions from companies like HP, IBM, and AT&T, and famously orchestrated the merger of Avago with Broadcom in a classic case of a smaller company swallowing a larger one," Lin said.
He added, "If GlobalFoundries, which has already integrated AMD and IBM's U.S. foundry operations, could now merge with Intel's foundry division, it would be a brilliant move. I hope that Lip-Bu Tan and Hock Tan—the two Tans—can dance a tango together, joining forces to restructure the U.S. semiconductor manufacturing industry." Such a partnership could not only bolster Intel's foundry ambitions but also reshape the competitive dynamics of the global chip market.
Why a TSMC-led acquisition of Intel's foundry is problematic
While rumors swirl about TSMC partnering with Nvidia, AMD, Broadcom, and Qualcomm to acquire Intel's foundry division, Lin cautioned against this approach, citing two major drawbacks. First, TSMC already holds a dominant position in the global foundry market, and absorbing Intel's foundry business could raise antitrust concerns. "If TSMC becomes even more dominant, it risks being seen as a monopoly, which could invite regulatory scrutiny," Lin warned.
Second, Lin questioned TSMC's ability to effectively manage Intel's foundry operations, pointing to cultural and operational challenges. "TSMC may not be familiar enough with American corporate culture to successfully integrate and manage Intel's massive manufacturing factories," he said. Lin referenced TSMC's struggles in Arizona, where its factory project faced delays and disputes, as evidence of potential mismatches in management style and expectations.
M. S. Lin is a former director of R&D and Fab director at TSMC. He is also the author of The Moore's Journey. Lin founded Megic—a company whose largest shareholder is Lip-Bu Tan's Walden International—and currently serves as chairman of iCometrue Inc.
M. S. Lin, a former Fab director at TSMC. Credit: Joseph Chen
Tan's deep ties to the semiconductor ecosystem
Beyond Lin's strategic insights, it's worth noting Lip-Bu Tan's deep and longstanding ties to the global semiconductor industry, particularly in Taiwan, which provide context for his appointment. Tan's connection to Taiwan's semiconductor ecosystem dates back 40 years when he answered the call of Taiwanese tech pioneer K. T. Li to invest in the island's chip sector through Walden International.
His early investments, such as supporting Cadence's predecessor ECAD in Hsinchu Science Park, helped lay the foundation for Taiwan's IC design industry and built a robust ecosystem that thrives today.
His tenure as CEO of Cadence Design Systems, where he turned the company from losses to profitability, and his board roles at major firms like SMIC and Sina, highlight his ability to drive transformation across technical and market domains. Tan has also been active in global semiconductor organizations, such as the Global Semiconductor Alliance and the Electronic Design Automation Consortium, showcasing his ability to integrate resources and push technological and market advancements.
Geopolitical challenges and national security concerns
Tan's career has not been without controversy, however. In recent years, his investments in Chinese AI and semiconductor companies through Walden International have drawn scrutiny, particularly amidst U.S.-China tech decoupling. According to a New York Times report, a U.S. congressional committee focused on China sent Tan a letter in 2023 requesting information about Walden's investments in blacklisted companies deemed a risk to national security.
Article edited by Jack Wu
