Intel Foundry and Tower Semiconductor have agreed on collaboration, as both companies previously exited from a $5.4 billion deal, citing regulator concerns.
Intel-Tower Latest Deal Allows Both Companies to Agree On Working Together Through Wafer Equipment Exchange
Intel has released a press statement expressing that the company won't stop working with Tower Semiconductor; instead, they plan to expand cooperation within wafer equipment exchange. Intel has revealed that it will supply 65nm power management BCD chips manufactured at Intel's Fab 11X facility in Rio Rancho, New Mexico. Tower will financially aid the process, investing $300 million into the New Mexico fab, which will help Intel meet the expected demand for 300mm advanced analog processing.
Intel is expected to supply 600,000 photo layers per month to meet Tower's demand, and this amount could vary based on industry circumstances. For those unaware, Tower is an Israeli semiconductor firm rapidly expanding its partnership with global leaders such as Intel. The company itself has foundries based in the US and Japan; however, it looks towards taking help from businesses like Intel to catalyst the development of its facilities.
We launched Intel Foundry Services with a long-term view of delivering the world’s first open system foundry that brings together a secure, sustainable, and resilient supply chain with the best of Intel and our ecosystem. We’re thrilled that Tower sees the unique value we provide and chose us to open their 300mm U.S. capacity corridor.
Stuart Pann, Intel Senior VP & GM IFS
While this partnership can't be categorized as a formality, the overall investment amount is about 18 times less than the previous deal between Intel and Tower, abandoned due to strict regulator concerns in China. Whether political elements influenced the deal is yet to be answered; however, it was a significant setback for Intel Foundry, considering that the division is already in a dire state, especially after the advent of strict US policies that have limited the company's business in China.
This development leads a step closer to Intel's IDM 2.0 strategy, which pledges to take the IFS division to new heights through rapid expansion and significant investments. With the expected release of Meteor Lake CPUs, Intel Foundry's "Intel 4" process is set to reveal what the division has to bring onboard in terms of performance and process efficiencies, and it could prove to be a significant uplifting moment, given that Intel could extract out the performance it expects.
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