Reuters reported on Wednesday (March 12) that Taiwanese chip giant TSMC has proposed to U.S. chip design companies Nvidia, AMD, Broadcom and Qualcomm to take stakes in a joint venture that would operate Intel’s foundry division.
According to reports, sources said that under the proposal, TSMC would be responsible for the operation of Intel’s wafer foundry division, but its stake would not exceed 50%. However, these negotiations are at an early stage.
Sources said that the US government had previously asked TSMC, the world’s leading chip foundry, to help US industrial giant Intel turn around its predicament.
Any final deal would require the Trump administration’s approval because Washington does not want Intel or its foundry unit to be fully foreign-owned, the sources said, asking not to be identified because the talks are private.
Intel, TSMC, Nvidia, AMD and Qualcomm declined to comment. The White House and Broadcom did not respond to Reuters’ request for comment.
Intel’s performance has been poor in recent years, and its stock price has lost more than half its value last year.
Intel’s financial report shows a net loss of $18.8 billion in 2024, the first since 1986, mainly due to large-scale impairment of its assets. Company filings show that as of December 31 last year, the book value of real estate and factory equipment in Intel’s wafer foundry division was $108 billion.
U.S. President Donald Trump is said to be eager to revive Intel’s fortunes as he promotes advanced manufacturing in the United States.
Sources said TSMC had recommended the joint venture plan to potential investors before it announced with Trump on March 3 a $100 billion investment in the United States and the construction of five new wafer fabs.
It is reported that negotiations on a joint venture for Intel’s foundry division have continued since then, with TSMC hoping to find more than one chip design company as a partner.
Although several companies have expressed interest in acquiring parts of Intel’s business, the report, citing two sources, said Intel has rejected discussions about selling its chip design and foundry divisions separately.
Sources said Qualcomm had earlier withdrawn from negotiations to acquire all or part of Intel’s shares.
It was reported that Intel board members had supported a deal and negotiated with TSMC, but some Intel executives were strongly opposed to it.
Intel’s foundry unit was a key part of former CEO Pat Gelsinger’s efforts to save the company, but Intel’s board forced out Gelsinger in December, appointed two interim co-CEOs and shelved its upcoming artificial intelligence (AI) chips.
Any deal between TSMC and Intel, two historical rivals, will face major challenges and be costly, time-consuming and laborious. The report cited sources from both companies as saying that TSMC and Intel currently use very different systems for processes, chemicals and chip manufacturing tools in their factories.
Intel has previously established manufacturing partnerships with Taiwan’s UMC and Israel’s Tower Semiconductor, which could provide a precedent for TSMC and Intel to work together. However, it is unclear how such a partnership would work without revealing manufacturing trade secrets.
The report quoted a source as saying that TSMC hopes that potential investors in the joint venture can also become customers of Intel in the field of advanced manufacturing.
According to a Reuters report last week, sources said that Nvidia and Broadcom are working with Intel to conduct manufacturing tests using Intel’s most advanced production technology 18A. AMD is also evaluating whether Intel’s 18A process meets its needs.
It is reported that 18A has always been a focus of contention in the negotiations between Intel and TSMC; during the negotiations in February, Intel executives told TSMC that its advanced 18A manufacturing technology is superior to TSMC’s 2nm process technology.