HomeUncategorizedChina sabotages Intel deal to buy Israeli chip maker

China sabotages Intel deal to buy Israeli chip maker

China has effectively thwarted a $5.4 billion takeover deal by Silicon Valley semiconductor giant Intel, in the latest sign of strained U.S.-China business relations.
Intel, which has been doing business in China for a long time, announced on Wednesday that it has “mutually agreed” with Israeli chipmaker Goto Semiconductors to terminate the original acquisition plan. The announcement came after Chinese antitrust regulators failed to approve the acquisition by a deadline set by the two companies.
Intel’s failure to complete the deal to buy Tower Semiconductor could further chill U.S. companies with deep ties in China, which has become increasingly difficult for U.S. companies to do business amid tensions between the two countries.
The acquisition plan was announced in February 2022 and has passed antitrust reviews in the United States and Europe. But it has faced lengthy delays in its antitrust review in China, which scrutinizes mergers of companies with some revenue in the country.
Technology is a major battleground in U.S.-China economic tensions.
The Chinese government is deeply disturbed by a series of U.S.-led international restrictions on the sale to China of the most advanced computer chips that can be used by the military, as well as the factory equipment to make them. The regulations came into effect in October last year. President Biden also took a separate step last week, ordering a ban on new investment in certain sensitive Chinese technologies .
China denounces these U.S. efforts as an attempt to curb China’s technological progress and slow China’s economic growth.
Despite high tensions between the U.S. and China, the economies of the two countries remain deeply interconnected, relying on each other for supply chains, technology and investment.


For Intel, China is both a major market and a place to do business: In 2022, Intel will employ more than 12,000 people in China and generate more than $17 billion in revenue, about 27% of its global total. Intel’s operations in China began in the mid-1980s and included assembling and testing chips made elsewhere.
Intel is struggling to regain its lead in chip production technology. The company had hoped that the acquisition of Tower Semiconductor would help speed up its transformation to become a major manufacturer for other chip designers. Intel previously mostly used its own factories to produce chips it designed and sold.

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