Intel Eyes US$15B Share Sale as Turnaround Rally Fuels Fundraising
Synopsis
The company is seeking to capitalise on its stronger share price to finance the costly expansion of its contract chipmaking business and advance manufacturing capabilities.
Intel plans to raise $15 billion through a public share sale as the chipmaker seeks to finance its expanding contract manufacturing business and capitalise on a sharp rally in its stock price.
The fundraising comes as Intel intensifies efforts to compete with Taiwan Semiconductor Manufacturing Co. (TSMC) in the global foundry market where demand for advanced chip production continues to grow alongside AI adoption.
According to Bloomberg, the offering could increase to around $20 billion if investor demand remains strong. The report added that orders have already exceeded $100 billion with the shares expected to be priced at $95 each or higher, a slight discount to Intel's Monday closing price of $97.52.
Capital Raise Follows Strong Stock Performance
Intel's shares declined more than 4% on Monday after the fundraising plans emerged. Even so, the stock has nearly tripled in value this year, outperforming rivals AMD and Nvidia as well as the broader Philadelphia Semiconductor Index, which has gained about 75% over the same period.
Analysts say the company's stronger market valuation has created an opportunity to raise capital without placing excessive pressure on existing shareholders. Intel has also increased its projected 2026 capital expenditure to $20 billion which reflects growing investment in advanced manufacturing facilities and packaging technologies needed to support AI-driven chip demand.
Manufacturing Strategy Gathers Momentum
The company has committed to launching high-volume production using its 14A manufacturing process in 2028, following customer wins that include Tesla for its foundry business. Market optimism has also grown after U.S. President Donald Trump suggested Apple could manufacture processors with Intel, although neither company has confirmed such an arrangement.
Intel is simultaneously expanding its global manufacturing footprint. Last month, it announced a €5 billion ($5.77 billion) investment to upgrade and expand its semiconductor manufacturing facility in Ireland which represents more than 25% of its planned capital spending for next year.
The share offering will be managed by JPMorgan Securities, Goldman Sachs, Morgan Stanley and Citigroup Global Markets with underwriters receiving a 30-day option to purchase up to $2.25 billion in additional shares.
Source: Reuters
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