TSMC Proposes Joint Venture to Operate Intel Foundries, Seeking Stakes from US Chip Designers
TSMC (2330.TW), the Taiwanese chipmaking giant, has proposed a joint venture with U.S. chip designers to operate Intel’s (INTC.O) factories, according to four sources familiar with the matter. The proposal involves TSMC running the operations of Intel’s foundry division, with TSMC potentially taking a stake of no more than 50%. The sources, who spoke on condition of anonymity, indicated that the talks are still at an early stage.
Qualcomm (QCOM.O) has also been pitched by TSMC, according to sources. The discussions come after the Trump administration requested TSMC assist in revitalizing the struggling U.S. industrial icon. A final deal would need approval from the administration, which does not want Intel or its foundry division to be fully foreign-owned.
Intel’s contract manufacturing business, or foundry division, was a core component of former CEO Pat Gelsinger’s plan to rescue Intel, but he was ousted in December. The company reported a substantial net loss in 2024, and the foundry division’s property and plant equipment had a book value of $108 billion as of December 31, according to a company filing.
A logo of Taiwanese chip giant TSMC.
The Taiwanese chipmaker’s joint venture pitch was made to potential backers before the company announced a $100 billion investment in the United States, involving the construction of five additional chip facilities. TSMC aims to have more than one chip designer as a partner.
While multiple companies have expressed interest in acquiring parts of Intel, the U.S. company has resisted selling its chip design division separately from the foundry. Intel board members have backed the negotiations with TSMC, though some executives are strongly opposed.
Any deal between TSMC and Intel would face considerable challenges, considering their vastly different manufacturing processes. However, Intel has previous manufacturing partnerships that could potentially serve as a blueprint. TSMC seeks investors in the joint venture to also be Intel’s advanced manufacturing customers.
