Apollo proposes $5 bln investment in Intel - Bloomberg

Investing.com -- Apollo Global Management (NYSE:APO ) has offered to make an investment of up to $5 billion in beleaguered semiconducter firm Intel Corporation (NASDAQ:INTC ), Bloomberg News reported on Sunday.

The asset manager indicated that it would be willing to make an equity-like investment in Intel, the Bloomberg report said, with top management of the chipmaker considering the offer. No deal has yet to finalized, Bloomberg noted, adding that the size of the possible investment could change and discussions could still collapse.

The equity investment would grant Intel some much needed breathing room, as the company grapples with a sharp decline in sales and a potential cash crunch during a time when Chief Executive Officer Pat Gelsinger is pushing to overhaul the business.

Intel has previously outlined cost-cutting measures, including reducing headcount by as many as 15,000 employees and temporarily halting plans for new factories in Europe. It is also considering splitting off its contract chipmaking unit from its design segment.

Apollo, which first started out in the 1990s as an investor in distressed assets, had earlier this year said it would acquire a 49% interest in a joint venture for Intel’s new production facility in Ireland for $11 billion.

Last year, the New York-based group also announced that it had agreed to lead a $900 million investment in computer drive manufacturer Western Digital Corp (NASDAQ:WDC ).

Reuters reported last week that Qualcomm (NASDAQ:QCOM ) was considering a friendly takeover of the chipmaker, although such a deal would likely face several regulatory hurdles. 

Once the world’s most valuable chipmaker, Intel’s shares are nursing a 60% slump so far this year, lagging of rivals like TSMC (NYSE:TSM ) and Nvidia (NASDAQ:NVDA ).

Representatives from both Apollo and Intel declined to comment, Bloomberg said.

(Ambar Warrick contributed reporting.)

Source: Investing.com