Silver Lake is in advanced talks to acquire a majority stake in Altera, Intel’s programmable chip unit, in a deal valuing the business at approximately $9bn, according to sources cited by the Financial Times.

Intel will retain a significant minority interest in Altera, which it originally acquired for $17bn in 2015. The divestment forms part of Intel’s strategy to shed non-core assets and free up capital to invest in new chip fabrication facilities across the US and Europe.

Altera produces programmable logic chips tailored for artificial intelligence applications, making it an attractive asset for private equity investors as demand surges in AI-driven computing. Silver Lake entered exclusive negotiations earlier this year after proposing a turnaround plan deemed viable by Intel.

Ken Hao, Chair of Silver Lake and a veteran investor in the semiconductor sector, is leading the deal. Hao previously played a key role in the formation of Broadcom by spinning out a chip division from Hewlett-Packard.

This pending deal comes amid broader restructuring at Intel. The company recently spun off its venture arm, Intel Capital, slashed thousands of jobs, and halted several European projects to stem losses from its chip foundry business. In December, Intel replaced CEO Pat Gelsinger with Lip-Bu Tan, former CEO of Cadence.

The US government has taken a keen interest in Intel’s future, given its position as the only domestic producer of advanced semiconductors. Intel is also reportedly in talks with the Trump administration regarding a possible partnership with TSMC.

Should the deal close, Silver Lake will gain a significant foothold in AI chip infrastructure, while Intel strengthens its liquidity to pursue large-scale manufacturing ambitions.

Source: Financial Times