Investing.com – Intel (NASDAQ:INTC) stock was up almost 1% in Friday’s premarket trading on a report in The Wall Street Journal that the company is in talks to buy GlobalFoundries for about $30 billion.
Mubadala, an investment arm of the Abu Dhabi government, owns GlobalFoundries. The deal is far from certain, according to the report.
Intel’s interest represents one of the biggest strategic moves yet under CEO Pat Gelsinger, who rejoined the company earlier this year. It comes at what may turn out to be peak of boom for chipmakers, who have been swamped with demand since the start of the pandemic and unable to increase supply quickly.
As companies adopt work from home, demand for digital devices from mobile to laptops to printers has surged, so has demand for smart electric vehicles and other renewables. All these machines have chips in them made by companies like Intel and Nvidia (NASDAQ:NVDA). Supply has lagged, making such deals attractive.
In Intel’s case, it has also ceded ground to players like Nvidia and AMD (NASDAQ:AMD) in the last few years and is now trying to recover that.
Intel has already announced plans to invest $20 billion in setting up two new manufacturing units in Arizona. GlobalFoundries too plans a new unit in Singapore, according to the WSJ.