Apollo Global Management has offered to invest billions of dollars in Intel, according to people familiar with the matter, in a sign of confidence in the chip maker’s turnaround strategy.
The alternative asset manager has indicated in recent days that it is willing to make an equity-like investment of up to $5 billion (roughly Rs. 41,753 crores) in Intel, said one of the people, who asked not to be named discussing confidential information. Intel Company officials are considering Apollo’s proposal, the people said.
Nothing has been finalised yet, the size of the potential investment could change and discussions could fall apart, resulting in no deal, the sources said.
The development is located in San Diego Qualcomm The US government is planning a friendly takeover of Intel, people familiar with the matter said on Saturday, raising the possibility of one of the biggest merger and acquisition deals ever.
Representatives for Apollo and Intel declined to comment.
Under the leadership of Chief Executive Officer Pat Gelsinger, Intel is pursuing a costly plan to reinvent itself and bring in new products, technologies and external customers.
The initiative led to declining earnings reports, undermining public confidence in the initiative and causing its market value to drop by billions of dollars. While Apollo is known today for its insurance, buyout, and credit strategies, the firm began as a distressed investing specialist in the 1990s.
The two companies already have ties. Santa Clara, California-based Intel in June agreed to sell a stake in a joint venture controlling a plant in Ireland to Apollo for $11 billion (roughly Rs. 91,857 crores), providing more external funding for a massive expansion of its factory network.
Apollo also has other experience in the chipmaking sector. Last year, the New York-based firm agreed to lead a $900 million (roughly Rs. 7,515 crores) investment in Western Digital Corp, buying convertible preferred stock.
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