Chipmaker Qualcomm considers friendly takeover of Intel

Qualcomm Inc. has approached Intel Corp. to discuss a potential takeover of the struggling chipmaker, a person with knowledge of the matter said, raising the possibility of one of the largest M&A deals in history.

According to the person, who asked not to be identified, in recent days Californian company Qualcomm has proposed a friendly takeover to Intel.

The approach is for all chipmakers, although Qualcomm has not ruled out buying or selling parts of Intel as part of a combination. It is unclear whether the initial move will lead to a deal, and any deal is likely to face strict antitrust scrutiny. Qualcomm has been in talks with U.S. regulators and believes an all-American combination could allay any concerns, the person said.

Qualcomm is eyeing Intel as its smaller rival goes through the most difficult period in its 56-year history.

Under Chief Executive Pat Gelsinger, Intel is working on a plan to turn the company around and revive its slumping stock price. It still believes the turnaround plan may be enough to remain an independent company, the person said. Intel shares have fallen about 37% over the past 12 months, giving it a market value of about $93 billion.

Qualcomm’s stock has surged more than 50% over the same period, to a market capitalization of about $188 billion. At that value, any deal between Qualcomm and all of Intel would be among the largest in history, according to data compiled by Bloomberg. The Wall Street Journal reported Qualcomm’s interest Friday, sending Intel’s shares up more than 3%. Representatives for Qualcomm and Intel declined to comment. Intel is headed toward a third straight year of declining sales, which is expected to hit $52 billion in revenue in 2024.