Semiconductor giant says opaquely it will use the proceeds for 'general corporate purposes'
Intel stands to raise $20 billion from a public offering of common stock after increasing the deal from the $15 billion announced on Monday, although analysts disagree over what the chip giant wants the cash for.The Santa Clara biz initially announced a $15 billion offering before pricing the shares at $95 apiece and increasing the deal to $20 billion.Intel is offering 210,526,315 shares at a price understood to represent a 6.5 percent discount to Friday's closing level. It has also granted underwriters a 30-day option to purchase up to 31,578,947 additional shares at the same price.
The CPU maestro said the net proceeds from the offering would go toward "general corporate purposes," which may include, but are not limited to, capital expenditures and working capital.
It also mentioned emerging areas including physical AI, purpose-built silicon, advanced packaging, and external wafers, all of which it sees as representing significant growth opportunities for Intel.Reports suggest Chipzilla wants the money to help build Intel Foundry into a full-fledged contract chipmaking business.The firm has been working toward this goal for some time, but has found it more costly than expected. Some observers believe the silicon supremo is taking advantage of the recent rise in its share price to raise extra cash.But others expressed doubt, especially as chipmakers typically seek tens if not hundreds of billions for any significant expansion."The use of funds is not well-defined in any of the announcements (not unusual), and not all that much money for a semiconductor company," said Gartner VP analyst for AI Infrastructure, Semiconductors and Quantum, Gaurav Gupta."Of course, this makes it easier for Intel to create new fabs, pursue M&A, and fund other activities, as it provides cash to the balance sheet. It is opportunistic as their market capitalization is up year-on-year," he told The Register.
