Intel has announced an agreement to sell a 51% stake in its programmable chip business, Altera, to private equity firm Silver Lake for US$4.46 billion. The deal values Altera at US$8.75 billion. It represents a significant step in Intel's strategy to streamline its operations and bolster its financial standing under its new CEO, Lip-Bu Tan.
According to Intel's press release, Reuters, and AP, the transaction, which is expected to close in the second half of 2025, will see Altera operate as an independent company, de-consolidated from Intel's financial statements. This move comes after Intel initially acquired Altera in 2015 for approximately US$17 billion, seeking to expand its reach into markets such as wireless and automotive. However, Altera's financial performance has consistently underperformed, accounting for only 3% of Intel's revenue in 2024 and posting an operating loss of US$615 million.
A strategic shift
The sale aligns with Intel's broader efforts to divest non-core assets and refocus on its core semiconductor manufacturing business amidst increasing competition within the industry. The substantial cash infusion from the deal is anticipated to provide Intel with greater financial flexibility as it pursues initiatives to reduce costs and optimize its portfolio.
Altera, founded in 1983, is a well-established manufacturer of programmable logic devices (PLDs), including field-programmable gate arrays (FPGAs). Following its acquisition by Intel, it became the company's Programmable Solutions Group (PSG). Intel had previously announced plans in October 2023 to spin off PSG, a transition that was completed on January 1, 2025, re-establishing Altera as an independent subsidiary.
New leadership
As part of the ownership change, Intel has announced that Raghib Hussain will succeed Sandra Rivera as CEO of Altera, effective May 5, 2025. Hussain, a seasoned technology executive, comes from Marvell, where he served as president of Products and Technologies. He previously co-founded Cavium, holding the role of COO, and has also worked at Cisco and Cadence.
Intel CEO Lip-Bu Tan emphasized that this change demonstrates Intel's focus on cost efficiency and strengthening its balance sheet. He praised Rivera's significant contributions during her 25-year tenure and expressed confidence in Hussain's leadership abilities to drive Altera's growth and innovation in the FPGA market.
The decision to sell a majority stake in Altera underscores Intel's commitment to strategic realignment and strengthening its financial position in a dynamic and competitive market. The industry will be closely watching the performance of an independent Altera under its new ownership and leadership.
Article edited by Jerry Chen
